The Kremlin clarified the effect of the decree on retaliatory measures to the oil price ceiling

Russian President Vladimir Putin’s decree on retaliatory measures to the oil price ceiling could also apply to existing contracts, said presidential spokesman Dmitry Peskov.

“If it contains a link to a certain price ceiling, then of course. If there are no references to the price ceiling, then it does not apply, ”the Kremlin spokesman answered the question whether the previously signed presidential decree on retaliatory measures to the oil price ceiling applies to existing contracts.

Peskov said that Putin had not consulted with OPEC+ before signing the aforementioned decree. According to the presidential press secretary, internal Russian consultations were held on this issue. “It is the sovereign right of Russia to respond to such illegitimate, absurd measures, the so-called price ceiling,” the Kremlin spokesman said.

Peskov said that there were no direct contacts with OPEC + on this topic. “Although on this topic, and on other topics related to the energy markets, the Russian side, through the supervising Deputy Prime Minister Novak, is in constant contact with the OPEC+ countries,” he specified.

The day before, December 27, Putin signed Decree on retaliatory measures to the oil price ceiling. It will enter into force on February 1, 2023. According to the text of the document, a ban is introduced on the supply of Russian oil and petroleum products to foreign companies and individuals if the contracts directly or indirectly provide for a cap price mechanism. It is emphasized that this measure is applied at all stages of deliveries to the final buyer. It is also clarified that the president can make a special decision on the supply of oil and oil products, in respect of which restrictions were previously introduced by decree.

The document was a response to the introduction by Western countries of a price ceiling for Russian oil. The EU countries have agreed on the marginal price for the energy carrier on 3 December. The price ceiling of $60 per barrel came into effect on December 5, along with a ban on Russian oil supplies by sea. For oil products, the restriction will come into effect on February 5, 2023. In addition to the EU, the G7 countries and Australia also joined the price limit.