Opec’s $60 cap on Russian oil imports

07.12.2022

It will stop Russian crude sold for more than that price from being shipped using G 7 and EU tankers, insurance companies and credit institutions. Many major global shipping and insurance companies are based within the G 7.

Russia - the world's second biggest producer of crude oil, has said it will not accept the price cap and threatens to stop exporting oil to countries adopting the measures.

It's likely that we're going to see some disruptions in the coming months and therefore probably oil prices will start to increase in the coming weeks. Opec made a decision to keep the quota where it is. Kang Wu of S&P Global Commodity Insights told the BBC that the oil market is an implicit type of support.

The easing of Covid restrictions in some Chinese cities could lead to an increase in demand for oil, according to analysts.

The $60 cap on Russian oil comes on top of an EU embargo on imports of Russian crude oil by sea and similar pledges by the US, Canada, Japan and the UK.

Russia will most certainly feel the blow, but it will also be softened by its move to sell its oil to other markets, such as India and China, who are currently the largest single buyers of Russian crude oil.