On Sunday, the EU set a cap on the price of Russian diesel and other petroleum products, further reducing energy dependence on Moscow.
The ban came into effect with the price cap agreed by the G7. The aim of the new measure is to allow Russian diesel fuel to continue to reach countries like China and India and avoid a price hike that will hit consumers around the world, while reducing the profits that finance the budget and the war that Russia has unleashed against Ukraine.
Recall that the EU is seeking new supplies of diesel fuel from the United States, the Middle East and India to replace supplies from Russia, which at one time supplied 10% of all European diesel needs. diesel fuel.
Fuel prices could rise as demand picks up in China as the country’s economy recovers from the end of strict COVID-19 restrictions.
The $100 per barrel price cap for diesel, jet fuel and gasoline should be enforced by prohibiting insurance and transportation companies from transporting it at a price that exceeds the cap. Most of these companies are located in western countries.
The new sanctions follow a $60-a-barrel cap on Russian oil prices that went into effect in December and is expected to do the same. Diesel and oil prices could be tightened later.
The marginal price of diesel will not be lowered immediately because it has been set at a level that roughly corresponds to that at which Russian diesel is sold.
The ban includes a 55-day grace period for diesel loaded into tank trucks until Sunday, a measure to avoid market turbulence. The EU says importers have had time to adjust after the ban was announced in June.
