EU to Propose Lowering Russian Oil Price Cap to $50 – Commerzbank

EU to Propose Lowering Russian Oil Price Cap to $50 – Commerzbank

The European Union is expected to propose reducing the price cap on Russian oil from the current $60 to $50 per barrel at the upcoming G7 finance ministers' meeting, according to Commerzbank commodity analyst Barbara Lambrecht. The proposed move aims to revive the effectiveness of the cap, which has become less impactful due to falling global oil prices.

Lambrecht explains that with lower oil prices, Russian exporters are still able to profit by using standard freight rates and insurance options, effectively bypassing the intended constraints of the existing cap. Lowering the ceiling would make it harder for Russia to exploit these market conditions while keeping revenues in check.

In addition to the cap adjustment, the EU is also preparing further measures under its 17th sanctions package, including tighter restrictions on Russia’s so-called "shadow fleet" — a network of vessels used to evade sanctions. These actions are part of ongoing efforts to limit Moscow’s oil revenue, which continues to fund its military operations in Ukraine.