Russia Says It Won't Sell Oil to Any Country That Adopts Price Cap
After the EU agreed to its eighth sanctions package on Russia over its war in Ukraine (see 2210050053), Russia said the restrictions would come with consequences and could lead to a temporary cut in the country's production of oil. The sanctions package includes a price cap on Russian oil. Russian Deputy Prime Minister Alexander Novak, speaking to Bloomberg TV, said Russia won't sell oil to any countries to impose a price cap, Bloomberg reported Oct. 5.
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“The price cap creates a very bad precedent and will primarily hit the ones who are actually doing it,” Novak said. “This mechanism is unacceptable to Russia.” Novak said the price cap would lead to a deficit given likely shortages in certain areas, higher shipping costs, later deliveries and lots of supply shocks. He later said Russia's oil production could drop to 490 million tons in 2023, from 530 million tons in 2022.