India Agrees to Ceiling on Oil Prices Set by Russia

Moscow, March 12 – India will adhere to a cap on the price of oil from Russia at $60, Bloomberg reports, citing people familiar with the matter.

“India will not violate Western sanctions imposed on Russia, including the $60 oil price cap from Moscow,” the agency said in a statement.

It is noteworthy that the Indian authorities asked merchants and banks to follow the rules.

“India had detailed discussions with the United States and the G7 countries on the sidelines of the G20 meeting … and they appear to be satisfied with the deals,” the agency said.

Western oil sanctions against Russia came into force on December 5, 2022: the European Union stopped accepting Russian oil transportation by sea, and the G7 countries, Australia and the European Union imposed a limit on its price during sea transportation at the level of $ 60 per barrel. The transportation and insurance of the most expensive oil is prohibited. In response, Russia, starting from February 1, banned the supply of oil to foreigners, if the contracts directly or indirectly provide for the use of a marginal price fixing mechanism.

On February 5, fuel sanctions began to work: the European Union banned the import of Russian oil products, while the European Union and the G7 countries set a price ceiling for these products. The cap is set at $100 per barrel for oil products from Russia that trade at a premium to standard grade oil (diesel fuel), and $45 per barrel for products that trade at a discount (fuel oil).