Russia’s ban on oil exports to countries and companies that adhere to Western price caps aimed at limiting the Kremlin’s energy revenues went into effect Wednesday.
President Vladimir Putin imposed the ban from February 1 to July 1 in response to the $60 per barrel price ceiling for Russian oil set by the G7 countries, the European Union and Australia in December.
The West’s moves are intended to cut Moscow’s key source of income while avoiding the collapse of the global oil industry as Russia’s war in Ukraine continues for almost a year.
Russia has said it will find new buyers beyond those that meet the price ceiling.
Putin’s decree prohibits the sale of oil to organizations whose contracts “directly or indirectly allow the use of a price cap mechanism.”
The Russian Energy Ministry is responsible for overseeing the ban, which Putin can lift on a case-by-case basis with a so-called “special decision.”
The measures came into effect after reports in January that Western oil tankers had boosted supplies of Russian oil below the $60 per barrel price ceiling.
Increased demand in Asia, oil prices and availability of tankers fueled Loading of crude oil from Russian ports hit a multi-month high of more than 9.5 million tons, according to Reuters.
