Kaja Kallas, the European Union’s foreign policy chief, is advocating for a reduction in the price cap on Russian oil. In an interview with Bloomberg Television on Tuesday, Kallas emphasized that lowering the cap would help further limit the Kremlin’s oil revenue.
“I’m really pushing for this to be lowered because it has a clear effect,” said Kallas, who also serves as the High Representative for Foreign Affairs and Security Policy and Vice-President of the European Commission.
The current price cap, set by the G7 and the EU, allows Russian crude shipments to third-party countries to access Western insurance and financing, provided the oil is sold at or below the $60-per-barrel limit. This measure was implemented in late 2022, alongside an EU embargo on Russian crude oil imports.
Kallas pointed out that while Russia is struggling with depleted national funds and lower oil and gas revenues, there is still room for further action. “There is still room that we can use. Definitely countries need to discuss that,” she said.
Six EU member states have already called for the price cap to be lowered. Sweden, Denmark, Finland, and the three Baltic states—Estonia, Latvia, and Lithuania—argued in a joint letter that targeting oil export revenues is critical to weakening Russia’s main income source.
“Measures that target revenues from the export of oil are crucial since they reduce Russia’s single most important income source,” the letter stated. “We believe now is the time to further increase the impact of our sanctions by lowering the G7 oil price cap.”
In response, Russia has made it clear it will not comply with any price caps. Instead, the country has turned to using its own tankers, insurers, and coverage providers from Asia and the Middle East. While this shift prevented an oil price crisis, Russian oil has continued to flow, albeit in different directions—mainly to the East of Suez.
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