Oil lawlessness: the EU is trying to find justice for the Russian “black gold”

MOSCOW, October 6 – PRIME, Oleg Krivoshapov. The European Union has introduced a new, eighth, package of anti-Russian sanctions: among the new measures are restrictions on coal, plastic, vehicles, crypto assets of Russians and residents of the country, and much more. However, the main component of the new package of sanctions against Russia is an attempt to impose a ceiling on the price of Russian oil. What will come out of this and what consequences can the energy market expect, Prime understood.

“Pour in cheap oil”: OPEC + put an end to the plans of the West


Member countries of the European Union on Thursday adopted the next – already the eighth – package of anti-Russian sanctions. Its approval required
from permanent representatives of the EU multi-day discussions. The measures approved as a result include both an economic component and an expansion of the list of personal restrictions.

New sanctions expand restrictions on commodity deliveries. It is prohibited to import finished products and semi-products from steel. It is now illegal to export all types of coal, machinery and equipment, plastics, vehicles, textiles, shoes, leather, ceramics, some chemical products and jewelry (except gold), military products. It is prohibited to provide services in the field of law, financial and IT consulting, architecture and engineering, as well as any cooperation with the Russian Maritime Register of Shipping.

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The ban on the import of steel products that are either produced in Russia or exported from Russia is being extended. The sale, transfer or export of additional products used in the aviation sector will also be restricted.

The European Commission claims that these trade restrictions will affect Russian exports worth 7 billion euros.

Citizens of EU countries will no longer be able to hold leadership positions in “certain state enterprises”. Separately, a ban on servicing crypto-wallets of citizens and residents of Russia is mentioned.

The EU has also introduced a new listing criterion that will allow sanctions to be applied to persons who contribute to violations of the prohibition on circumvention of sanctions.


The attempt to set a price ceiling for Russian oil deserves special attention, agreed within the framework of the eighth package of anti-Russian sanctions. So far, the base for “black gold” transported by sea to third countries is only being established. In addition, a ban is introduced on the sea transportation of this raw material if it was purchased at a price exceeding the established ceiling. It will come into effect for crude oil from December, for petroleum products – from February next year.

Judging by the reaction of observers in Russia and abroad, it is the topic of restrictions in the oil sector that is the most important component of the new sanctions package from a practical point of view. Yes, and some EU countries in the course of coordination expressed concern, first of all, about Brussels’ plans to introduce an upper limit on oil prices. Among them were Greece and Cyprus.

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But Russia has its own methods of countering the sanctions hysteria of the West. It could drastically cut oil production. According to Bloomberg estimates, we can talk about 3 million barrels per day, if the EU and the US continue to implement a plan to limit prices for Russian “black gold”.

The American agency refers to the opinion of the head of the consulting company Rapidan Energy Group, which indicates that Russia can take such a step without damaging its oil fields. “Russian companies have become pros in the flexibility of production at old fields, and the remaining ones can increase the production of resources,” he said. And the managing director of analyst firm ClearView Energy Partners explained that “even half of that (i.e. 1.5 million barrels per day – ed.) could put immediate pressure on the markets.”

Production cuts are not the only answer, warns Bloomberg. Russia has other options as well, including halting crude oil exports via the Druzhba pipeline and the Caspian Pipeline Consortium (CPC) route in order to “actually raise prices anyway.”
Moreover, already on October 5, hours after the EU countries signed their eighth package of anti-Russian sanctions, Russia said that restrictions on its oil would backfire and could lead to a temporary reduction in production in the country. In an interview with Bloomberg TV yesterday, Russian Deputy Prime Minister Alexander Novak repeated the warning that Russia would not sell oil to any countries that would accept the restrictions.

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European gas prices are on the rise

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On the same day, October 5, members of the OPEC + alliance agreed in Vienna to reduce oil production quotas by 2 million barrels per day. And while Citigroup analysts say this could anger major buyers of raw materials, pushing the US to conclude a nuclear deal with Iran and accelerate plans to impose a price ceiling on oil purchases from Russia, the alliance is unlikely to abandon its plans.

However, the actions of OPEC + may force the US Congress to return to the discussion of the NOPEC bill, which will make it possible to file lawsuits against oil exporting countries under the current antitrust laws, the bank said in a report. Whether this will produce the result expected by Washington is another question.

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