Putin: discount on oil should not create problems for the Russian budget

Russian President Vladimir Putin called for attention to the situation with the discount on Russian oil, stressing that it should not create problems for the Russian budget.

“We need to look at this discount so that it does not create any problems with the budget. Discuss, then report your proposals to me separately,” he said, after listening to the report of Deputy Prime Minister Alexander Novak in the stamps of the meeting with members of the government (quote according to TASS).

Novak in his report acknowledgedthat the introduction of a ceiling on prices for Russian oil led to difficulties in the form of a high discount on raw materials. “The cost of freight has grown quite strongly due to the risks that carriers and counterparties experience regarding possible sanctions in accordance with the fact that they do not set a price ceiling,” he said. Novak expressed hope that the situation would be temporary.

Earlier today the Ministry of Finance informedthat the Russian budget in January may receive less than 54.5 billion rubles. oil and gas revenues. Against the backdrop of falling oil and gas revenues, the Bank of Russia will resume foreign exchange interventions on the budget rule on January 13. The Central Bank will start selling yuan in the currency section of the Moscow Exchange with a settlement term “tomorrow”.

After that, the Ministry of Energy admitted introduction of additional measures to counteract the price ceiling for Russian oil. In particular, they can be aimed at “limiting the possible discount” on Russian raw materials for deliveries abroad “up to the limits based on market prices.”

On December 3, 2022, the EU countries agreed on a price ceiling for Russian oil of $60 per barrel, which is expected to be reviewed every two months so that the ceiling level is 5% below the price of Urals. The restriction came into force on December 5, along with a ban on the supply of Russian oil by sea to the EU countries. For oil products, the restriction will come into effect on February 5. In addition to the EU countries, the G7 countries and Australia also joined the ceiling.