EU to shelve Russian oil cap plan – Bloomberg

The 27 member states are said to be divided on the proposed measure

European Union countries are struggling to reach an agreement on imposing a price cap on Russian oil and will likely push back on the idea until a broader set of sanctions has been agreed , reports Bloomberg on Monday.

According to the outlet, citing sources familiar with the ongoing talks, Cyprus and Hungary are among the countries that have voiced their opposition to the oil price cap proposal. Meanwhile, EU sanctions require bloc unanimity, giving each nation effective veto power.

Sources told Bloomberg that the European Commission met with member states over the weekend to try to find a compromise on the sanctions package. Many details would still need to be ironed out, including at what price the allies would set the cap. The sources also said that any measure should come into force before December 5, when the measures previously adopted by the EU would come into force and ban the import of oil transported by sea as well as the services necessary for the dispatch.

« EU pressure to impose a cap on Russian oil prices would align the bloc with a US effort to keep the cost of crude from skyrocketing and eating away at Moscow’s revenue from energy sales, » writes Bloomberg.

READ MORE: More EU anti-Russian sanctions are on the way — FT

Earlier this month, the Group of Seven (G7) countries reached an agreement to block the shipment of Russian crude above the set price.

Western leaders agreed in June to explore a price cap to limit how much refiners and traders can pay for Russian crude. Moscow has made it clear that it will not comply, instead shipping its crude to countries not bound by the cap. Deputy Prime Minister Alexander Novak has warned that countries that support the price cap will not get Russian crude.

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