Germany warns possible price caps for Russian oil far from imminent – sources & More News Here

Industrial amenities of PCK Oil Raffinerie are pictured in Schwedt/Oder. The firm receives crude oil from Russia through the ‘Friendship’ pipeline, Germany, May 9, 2022. REUTERS/Hannibal Hanschke

BRUSSELS, June 30 (Reuters) – Germany and different European Union governments voiced warning in a closed-door assembly about price caps on Russian oil, a day after the Group of Seven financial powers agreed to urgently begin work on the matter, EU officers advised Reuters on Thursday.

On Tuesday G7 leaders agreed to discover “the feasibility of introducing temporary import price caps” on Russian fossil gasoline, together with oil, and tasked ministers to judge the proposal urgently. learn extra

A day later, Germany’s envoy to the EU advised his counterparts in a restricted assembly that the world ought to be “realistic” in regards to the proposal, which he mentioned was added to the G7 assertion after “intense pressure” from Washington, in line with one official who attended the assembly.

The envoy additionally mentioned an settlement on whether or not to use caps was not anticipated to return anytime quickly, in line with the supply.

Hungary and Belgium additionally raised issues on the assembly in regards to the G7 assertion on sanctions, the official mentioned, with Hungary explicitly backing Berlin’s warning on oil price caps.

A second EU official accustomed to the talks confirmed that Germany and others had expressed wariness about oil price caps.

A spokesperson for Germany’s embassy to the EU declined to remark.

A German authorities official mentioned on Thursday that “success of this plan depends on international cooperation”.

Stefano Sannino, secretary basic of the EU’s diplomatic service mentioned on Thursday {that a} price cap would solely be efficient if universally utilized, and so settlement could be wanted throughout the G20 nations, not simply the G7.

“You need to be sure you do not have distortion of trade and then the only thing that is happening is that essentially oil goes to other places with other carriers and insured by other companies – and so the price remains the same,” Sannino advised an EU-UK Forum convention.

Under EU sanctions that can turn into efficient in December, insurance coverage and different monetary companies essential for Russian oil shipments shall be banned worldwide.

Critics of this worry it may result in increased world oil costs due to the important thing function EU firms play in transport insurance coverage, bringing a profit to Moscow. learn extra

A cap, if agreed, would successfully make it possible for firms to commerce Russian oil, as a substitute of going through a complete ban.

However, the EU sanctions on Russian oil, which took weeks to agree, must be tweaked and reopening the talk on this measure could possibly be controversial, officers mentioned.

Reporting by Francesco Guarascio @fraguarascio
Additional reporting by John Chalmers; enhancing by David Evans

Our Standards: The Thomson Reuters Trust Principles.

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