The EC said that “the time has come” to limit the price of Russian gas

The head of the European Commission, Ursula von der Leyen, said that the time has come to introduce a price ceiling for Russian gas in the EU. She clarified that the European Commission will soon come up with this initiative, Reuters reported.

“I firmly believe that the time has come to put a price cap on pipeline Russian gas going to Europe,” she said (citata on Kommersant). According to von der Leyen, a price cap could be proposed at the level of the EU leadership to counter “attempts by the Russian president to manipulate the European energy market.”

Also the Financial Times informedthat the finance ministers of the G7 countries (USA, Canada, UK, Japan, Germany, France and Italy) will today approve the introduction of a plan to limit prices for oil and oil products from Russia. According to it, a ban will be introduced on financing and insurance of Russian oil supplies if they are carried out at a price higher than agreed by the G7 member countries. For oil supplies, it will come into effect on December 5, when the EU embargo on Russian oil supplies comes into force, and for oil products, on February 5, 2023. In this way, European officials want to keep the supply of products from Russia, while reducing its oil revenues.

In response to such a decision, the press secretary of the President of Russia Dmitry Peskov said that when a price limit for Russian gas, oil and oil products is set, these energy resources will be supplied in other directions – to countries that work on market conditions, transmits RIA Novosti agency.

The day before, on September 1, Deputy Prime Minister of Russia Alexander Novak made a similar statement. He said that Russia would stop supplying oil and oil products to those countries that would impose a price limit on these products, since they would use non-market mechanisms. According to him, the idea of ​​limiting the price of Russian oil is “completely absurd,” it could destabilize the entire industry, causing oil prices to rise, and EU and US consumers will suffer from this.

The talks of the G7 countries on limiting prices for Russian oil became known in July. As Bloomberg wrote then, Western countries are discussing a range from $40 to $60 per barrel, which will be higher than the cost of oil production, i.e. Russia will have an incentive to continue it. At the same time, the administration of US President Joe Biden considers the $40 limit too low and could lead to another jump in oil prices due to a reduction in Russian supplies.

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