Russian oil capped at $60 after G7 and Australia agreement

The price of oil sold by Russia to Western countries will be capped at $60 per barrel from the next few days.

Share:

Comprehensive energy news coverage, updated nonstop

Annual subscription

8.25€/month*

*billed annually at 99€/year for the first year then 149,00€/year ​

Unlimited access • Archives included • Professional invoice

OTHER ACCESS OPTIONS

Monthly subscription

Unlimited access • Archives included

5.2€/month*
then 14.90€ per month thereafter

FREE ACCOUNT

3 articles offered per month

FREE

*Prices are excluding VAT, which may vary depending on your location or professional status

Since 2021: 35,000 articles • 150+ analyses per week

The price of oil sold by Russia to Western countries will be capped at 60 dollars a barrel from the next few days, the countries of the European Union, then those of the G7 and Australia having reached an agreement three days before the entry into force of the European embargo.

“The G7 and Australia (…) have reached a consensus on a maximum price of 60 US dollars per barrel for Russian crude oil transported by sea,” these countries announced in a joint statement.

U.S. Treasury Secretary Janet Yellen welcomed the announcement in a statement, which “is the culmination of months of effort by our coalition.”

The agreement was made possible by the consensus reached earlier in the day by the 27 countries of the European Union, which managed to rally Poland.

The finance ministers of the G7 countries agreed in early September on this tool, designed to deprive Moscow of the means to finance its war in Ukraine.

In concrete terms, the price set must be high enough to keep Russia interested in continuing to sell them oil, but lower than the price to limit the revenue it can earn.

The mechanism will come into effect on Monday “or very shortly thereafter,” the G7 and Australia said. The EU embargo on Russian seaborne oil begins on Monday.

Thus, only oil sold by Russia at a price of $60 or less will continue to be delivered.

Beyond this ceiling, it will be forbidden for companies to provide the services that enable maritime transport (freight, insurance, etc.).

Currently, the G7 countries provide insurance for 90% of the world’s cargo and the EU is a major player in ocean freight, which gives it a credible deterrent, but also a risk of losing business to competitors.

Price adjustment

Russia, the world’s second largest exporter of crude oil, had warned that it would no longer supply oil to countries that adopted the cap.

Without this cap, it would be easy for him to find new buyers at market prices.

The price of a barrel of Russian oil (Ural crude) is currently around 65 dollars, which is barely more than the European ceiling, implying a limited impact in the short term.

“We will be prepared to review and adjust the maximum price if necessary,” the G7 and Australia said in their statement. And a cap should also be found for Russian oil products from February 5, 2023.

The European embargo comes several months after the one already decided by the United States and Canada.

But the Westerners must also deal with the interests of powerful British insurers or Greek shipowners.

“The EU remains united and stands in solidarity with Ukraine,” the Czech Presidency of the EU Council welcomed in a tweet.

Russia has earned 67 billion euros from its oil sales to the EU since the start of the war in Ukraine, while its annual military budget amounts to about 60 billion, recalls Phuc-Vinh Nguyen, an expert on energy issues at the Jacques-Delors Institute.

Fears of destabilization

The instrument proposed by Brussels provides for the addition of a limit set at 5% below the market price, in the event that Russian oil falls below 60 dollars.

In fact, some experts fear a destabilization of the world market and wonder about the reaction of the Opec producing countries, which meet on Sunday in Vienna.

“This cap will help stabilize global energy markets (…) and will directly benefit emerging economies and developing countries,” since Russian oil can be delivered to them at prices below the cap, instead assured on Twitter the President of the European Commission, Ursula von der Leyen.

As of Monday, the EU embargo on Russian seaborne oil will cut two-thirds of its crude purchases from Russia.

Germany and Poland having also decided to stop their deliveries via a pipeline by the end of the year, total Russian imports will be affected by more than 90%, say the Europeans.

On the other hand, “an oil price ceiling has never been seen before. We are in the unknown,” said Phuc-Vinh Nguyen, stressing that the reaction of OPEC countries or large buyers like India and China will be crucial.

The only certainty, according to him: a cap, even at a high price, will send “a strong political signal” to Russian President Vladimir Putin, because, once in place, this mechanism can be tightened.

Cenovus Energy has purchased over 21.7 million common shares of MEG Energy, representing 8.5% of its capital, as part of its ongoing acquisition strategy in Canada.
In September 2025, French road fuel consumption rose by 3%, driven by a rebound in unleaded fuels, while overall energy petroleum product consumption fell by 1.8% year-on-year.
Société Ivoirienne de Raffinage receives major funding to upgrade facilities and produce diesel fuel in line with ECOWAS standards, with commissioning expected by 2029.
India is funding Mongolia’s first oil refinery through its largest line of credit, with operations scheduled to begin by 2028, according to official sources.
Aramco CEO Amin Nasser warns of growing consumption still dominated by hydrocarbons, despite massive global energy transition investments.
China imported an average of 11.5 million barrels of crude oil per day in September, supported by higher refining rates among both state-run and independent operators.
The New Vista vessel, loaded with Abu Dhabi crude, avoided Rizhao port after the United States sanctioned the oil terminal partly operated by a Sinopec subsidiary.
OPEC confirms its global oil demand growth forecasts and anticipates a much smaller deficit for 2026, due to increased production from OPEC+ members.
JANAF is interested in acquiring a 20 to 25% stake in NIS, as the Russian-owned share is now subject to US sanctions.
The US Treasury Department has imposed sanctions on more than 50 entities linked to Iranian oil exports, targeting Chinese refineries and vessels registered in Asia and Africa.
Khartoum et Juba annoncent un mécanisme commun pour protéger les oléoducs transfrontaliers, sans clarifier le rôle des forces armées non étatiques qui contrôlent une partie des installations.
The Namibian government signed an agreement with McDermott to strengthen local skills in offshore engineering and operations, aiming to increase oil sector local content to 15% by 2030.
Nigeria deploys a 2.2 million-barrel floating storage unit funded by public investment, strengthening sovereignty over oil exports and reducing losses from theft and infrastructure failures.
Despite open statements of dialogue, the federal government maintains an ambiguous regulatory framework that hinders interprovincial oil projects, leaving the industry in doubt.
Canada’s Sintana Energy acquires Challenger Energy in a $61mn all-share deal, targeting offshore exploration in Namibia and Uruguay. The move highlights growing consolidation among independent oil exploration firms.
The 120,000-barrel-per-day catalytic cracking unit at the Beaumont site resumed operations after an unexpected shutdown caused by a technical incident earlier in the week.
An agreement was reached between Khartoum and Juba to protect key oil installations, as ongoing armed conflict continues to threaten crude flows vital to both economies.
Alnaft has signed two study agreements with Omani firm Petrogas E&P on the Touggourt and Berkine basins, aiming to update hydrocarbon potential in key oil-producing areas.
Import quotas exhaustion and falling demand push Chinese independent refineries to sharply reduce Iranian crude volumes, affecting supply levels and putting downward pressure on prices.
Serbian oil company NIS, partially owned by Gazprom, faces newly enforced US sanctions after a nine-month reprieve, testing the country's fuel supply chain.

All the latest energy news, all the time

Annual subscription

8.25€/month*

*billed annually at 99€/year for the first year then 149,00€/year ​

Unlimited access - Archives included - Pro invoice

Monthly subscription

Unlimited access • Archives included

5.2€/month*
then 14.90€ per month thereafter

*Prices shown are exclusive of VAT, which may vary according to your location or professional status.

Since 2021: 30,000 articles - +150 analyses/week.