According to the Committee on Eastern European Economic Relations, the price cap for Russian crude oil is having an effect. “The idea with the price cap works,” said Michael Harms, managing director of the committee, in Berlin. “What we are hearing from the companies involved is that above all Arab, Turkish and Chinese banks are very reluctant to trade Russian oil products,” he added. Russia apparently has to sell its diesel below value.
In December, the EU, supported by the countries of the largest industrial nations (G7), set the upper limit for Russian crude oil at 60 dollars per barrel (159 litres). This means that deliveries at a higher price, even to third countries, may not be cleared by Western insurance companies and shipping companies. The measure serves to deprive the Kremlin of revenue for its war of aggression against Ukraine. Since the beginning of February, the EU member states have also stopped importing refined products such as diesel, petrol and lubricants from Russia.
“We were afraid that the price of diesel would increase sharply,” said Harms. “That hasn’t happened at all so far.” However, the association’s managing director emphasized that the Russian economy would not collapse despite all the sanctions. Russia will gradually slip further into an economic crisis and become technologically uncoupled. But: “Putin will not run out of money for the war,” said Harms.
The Eastern Committee of German Business is a German foreign trade association for promoting economic relations between Germany and 29 countries in Eastern Europe, East Central Europe, Russia, Southeast Europe and Central Asia.
