Russian oil capped at $60 after G7 and Australia deal


Street scene in Donetsk, eastern Ukraine, on December 2, 2022 (AFP/ANATOLII STEPANOV)

Ukrainian President Volodymyr Zelensky deemed insufficient on Saturday the cap on the price of a barrel of Russian oil at 60 dollars, decided the day before by the countries of the EU, the G7 and Australia, considering that it was not a question of a “serious decision”, kyiv suggesting a price twice as low.

Russia for its part affirmed that it “would not accept” this ceiling which must be put in place in the coming days to limit the financial means of Moscow in its invasion of Ukraine.

The price of a barrel of Russian oil (crude from the Urals) is currently fluctuating around 65 dollars, barely above the European ceiling, thus implying a limited impact in the short term.

In the morning, kyiv was however satisfied with such a binding mechanism, wanting to believe sooner or later in the “destruction” of the Russian economy under the weight of international sanctions. “It would have been necessary to lower (the ceiling price) to 30 dollars to destroy (the Russian economy) even more quickly”, had however specified the chief of staff of the Ukrainian presidency, Andriï Yermak.

But in the evening, President Zelensky adopted a much more critical position towards Westerners.

– “Weak position” –

“It is not a serious decision to set such a limit for Russian prices, which is quite comfortable for the budget of the terrorist state,” he said, according to the office of the presidency.

“Russia has already caused colossal losses to all the countries of the world by deliberately destabilizing the energy market. And the world cannot dare” to carry out a “real energy disarmament” of Moscow, he regretted. “It’s a weak position,” he hammered.

A ceiling criticized in kyiv and rejected by Moscow. “We will not accept this ceiling,” Kremlin spokesman Dmitry Peskov told the press, quoted by Russian agencies, when Moscow had already warned that it would no longer deliver oil to countries that adopted this ceiling. measure.

In this first reaction from Moscow, Mr. Peskov however affirmed that Russia had “prepared” upstream “for such a ceiling”, without giving more details.

A resident pushes a cart with firewood down a street in Bakhmout, eastern Ukraine, on December 2, 2022.

A resident pushes a cart with wood down a street in Bakhmout, eastern Ukraine, on December 2, 2022 (AFP/ANATOLII STEPANOV)

On Friday, the 27 countries of the European Union, the G7 and Australia had agreed on “a maximum price of 60 US dollars for crude oil of Russian origin transported by sea”, according to the terms of a joint press release.

In a bar in Lviv (western Ukraine), during a power outage, December 2, 2022

In a bar in Lviv (western Ukraine), during a power outage, December 2, 2022 (AFP / YURIY DYACHYSHYN)

The mechanism will come into force on Monday “or very soon after”, said the G7 and Australia. It is also on this day that the EU embargo begins on Russian oil transported by sea, which will already eliminate two thirds of its crude purchases from Russia.

Thus, only oil sold by Moscow at a price equal to or less than 60 dollars can continue to be delivered. Beyond this ceiling, it will be prohibited for companies to provide services allowing maritime transport (freight, insurance, etc.).

Germany and Poland having also decided to stop their deliveries via an oil pipeline by the end of the year, in addition to the European embargo, total Russian imports will be affected by more than 90%, according to Europeans.

– “On time” –

A man chops wood in a building yard in Bakhmout, eastern Ukraine, on December 2, 2022.

A man chops wood in a building yard in Bakhmout, eastern Ukraine, on December 2, 2022 (AFP/ANATOLII STEPANOV)

The Kremlin also said on Saturday that Vladimir Putin would go “in due course” to Donbass, the area in eastern Ukraine that he annexed at the end of September, without however having his army fully control it.

Ukrainian authorities have again urged civilians to hold firm despite deteriorating living conditions.

Several times a day, power cuts plunge millions of Ukrainians into darkness, not to mention the cold that settles in their homes.

Building damaged by a missile in Kluhyno-Bachkyrivka, in the Kharkiv region (northeastern Ukraine), December 2, 2022

Building damaged by a missile in Kluhyno-Bachkyrivka, in the Kharkiv region (north-eastern Ukraine), on December 2, 2022 (AFP/SERGEY BOBOK)

Temperatures in some areas have been around -5°C in recent days, and the perceived temperature can be even lower.

“We have to hold on,” Vitaliï Kim, governor of the Mykolaiv region in the south, told Ukrainian television.

On the other hand in Kherson, also in the south, “the electrical networks, which were out of order because of enemy bombardments, are again connected” and “75% of Kherson has electricity again”, said congratulated the head of the regional administration Yaroslav Yanushevych.

War in Ukraine: the situation in the East

War in Ukraine: the situation in the East (AFP/)

On the ground, the fighting is “hard” in the east of the country because “the Russians have had time to prepare” for the attacks by troops from kyiv, said the governor of the Lugansk region, Serguiï Gaïdaï.

– Battle around Bakhmout –

According to a bulletin from the Ukrainian presidency, the situation is also “difficult” near Bakhmout, a city in the Donetsk region that the Russians have been trying in vain to conquer since the summer.

The battle around Bakhmout has in recent days taken on all the more symbolic importance for Moscow as its conquest would come after a series of humiliating defeats, with the retreats from Kharkiv (northeast) in September and Kherson (south) in November .

French President Emmanuel Macron, for his part, announced that he would speak “soon” with Vladimir Putin on security issues around “civilian nuclear” in Ukraine, after an interview scheduled for Sunday with the director general of the International atomic energy (IAEA).

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© 2022 AFP

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