Western governments are aiming to cap the price of Russia's oil exports in an attempt to limit the fossil fuel earnings that support Moscow's budget, its military and the invasion of Ukraine.
The cap is set to take effect on Dec. 5, the same day the European Union will impose a boycott on most Russian oil -- its crude that is shipped by sea. The EU was still negotiating what the price ceiling should be.
Insurance companies and other firms needed to ship oil would only be able to deal with Russian crude if the oil is priced at or below the cap. Most of the insurers are located in the EU or the United Kingdom and could be required to participate in the cap. Without insurance, tanker owners may be reluctant to take on Russian oil and face obstacles in delivering it.Universal enforcement of the insurance ban, imposed by the EU and U.K.
"It is essential for the global crude markets that Russian oil still finds markets to be sold, after the EU ban is operative," he added. "In the absence of that, global oil prices would skyrocket."A cap of between US$65 and US$70 per barrel could let Russia keep selling oil and while keeping its earnings to current levels. Russian oil is trading at around $63 per barrel, a considerable discount to international benchmark Brent.
China and India might not go along with the cap, while China could form its own insurance companies to replace those barred by U.S., U.K. and Europe.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Explainer: What is the Emergencies Act and when can it be used?What exactly is this never-before-used piece of legislation, and how will we know if it was deployed appropriately? Here’s what you need to know.
Read more »
Cowboy Boots for Women: How to Wear Western Boots NowHow do you style cowboy boots for women and take them from the ranch to the runway? Think denim, monochromatic colours and bohemian dresses.
Read more »
We can now blame Western Canada’s deadly heat dome on climate change — definitivelyResearchers at Columbia University have been able to pin the blame for the 2021 heat dome squarely on climate change.
Read more »
Western Canada: Alberta Premier attempts to change the channel with cost-of-living measuresAlberta Premier Danielle Smith’s first month in office was overshadowed by her views on vaccination and controversial comments from her past
Read more »
Russian strike on Ukrainian maternity hospital kills babyDonetsk is under fierce attacks and constant shelling, President Zelensky says
Read more »