Russian President Vladimir Putin has signed a decree that enacts special economic measures in response to Western states imposing price ceilings on Russian petroleum products and crude oil. The relevant document was published on the official legal information portal on Tuesday.
In the decree that entered into force on February 1 and is valid until July 1, 2023, Putin prohibited the delivery of oil at a “ceiling price”. The president ruled out the sale of oil to foreign buyers even if the contract uses a price-fixing mechanism. The Russian government will be able to decide on the extension of the ban.
Delivery of Russian crude oil and petroleum products to the countries introducing the price ceiling will be possible only on the basis of a special decision of the Russian president. In general, regular monitoring of the implementation of the decree is the responsibility of the Ministry of Energy.
According to the document, the measures
“in connection with the unfriendly and contrary actions of the United States and foreign states and international organizations that have joined it”, and to protect Russia’s national interests.
Last week, Russian Deputy Prime Minister Alexander Novak indicated Moscow’s readiness to partially reduce oil production by 500-700 thousand barrels per day, which is five to seven percent of the total amount, in response to the introduction of the price ceiling for Russian energy carriers.
The oil sanctions of Western countries came into effect on December 5: the European Union stopped receiving Russian oil transported by sea, and the most developed countries (G7), Australia, and the EU set a price ceiling of $60 per barrel for sea shipments. It is forbidden to deliver or provide oil more expensive than this.