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Putin bans Russian oil supplies at 'capped' prices from February 2023

The government was instructed to determine this date and adopt acts aimed at implementing the relevant ban

MOSCOW, December 27. /TASS/. President Vladimir Putin signed a decree on retaliatory measures to the West's imposition of a price cap on Russian oil. The document bans supplies of Russian oil to buyers who join the West’s restrictions after February 2023.

"<...> The supply of Russian oil and oil products to foreign legal entities and individuals is prohibited, provided that the contracts for these supplies directly or indirectly provide for the use of a price fixing mechanism. The established ban applies at all stages of supplies to the final buyer," according to the decree, which was published on Tuesday.

The document comes into force on February 1, 2023 and is valid until July 1, 2023.

The ban on the supply of oil established by this decree will be applied directly starting February 1.

The ban on the supply of Russian oil products will be applied "from the date determined by the government of the Russian Federation, but not earlier than from the date this decree comes into force."

The government was instructed to determine this date and adopt acts aimed at implementing the relevant ban.

However, in a separate clause, the President reserves the right to make special decisions on the supply of oil and petroleum products in cases where they are banned by the decree. That means that deliveries of Russian oil and oil products to countries that join the West’s price cap policy will be possible on the basis of the President’s special decision.

The Energy Ministry was instructed to monitor the implementation of the ban on a regular basis. Together with the Finance Ministry, it is granted the right to give official clarifications on the application of the decree. Control over its implementation is entrusted to the interdepartmental working group.

On December 5, an embargo on maritime oil supplies from Russia to the European Union came into force. The EU, the Group of Seven (the UK, Germany, Italy, Canada, USA, France, Japan), as well as Australia, agreed on a price cap for Russian oil supplied by sea at $60 per barrel. The US, EU and UK are banning their companies from providing transport, financial and insurance services to tankers carrying oil from Russia at a price above the agreed upon level.

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