US President Joe Biden and US First Lady Jill Biden walk to their vehicle after disembarking Air Force One at Joint Base Andrews in Maryland on October 31, 2022. (Photo by Mandel NGAN / AFP)
Washington: The US. Treasury Department on Monday said vessels of Russian petroleum that are loaded before December 5 and unloaded at their destination before January 19, will not be subject to the price cap being planned by Western governments.
The US government, the G7 and the EU plan to impose the price cap which begins on December 5 as part of sanctions against Russia for its invasion of Ukraine.
The exact price levels of the caps, which will be placed on shipments of Russian crude oil and oil products, is still being worked out. A senior Treasury Department official told reporters in a call that discussions on the price level among G7 countries and Australia are centering on Russian oil production costs and historic prices for Russian Urals oil.
One person familiar with the process said last week the cap will be determined in line with the historical average of $63-$64 a barrel, a level that could form a natural upper limit.
The Treasury official said the department had held more than 100 conversations with industry groups to address their concerns. Allowing petroleum to be unloaded before January 19 gives players in oil markets room to get used to the price cap, the official said. The Treasury published the clarification on when cargoes would be hit with a price cap on its website in a "frequently asked questions" item.
