The EU proposes to lower the price threshold for Russian oil. Reuters writes about $50 per barrel
Photo: EPA

The European Union this week will propose to the Group of Seven (G7) members to change the price threshold for Russian oil, European Economic Commissioner Valdis Dombrovskis said on Monday, May 19. According to sources Reuters, a reduction to $50 per barrel will be proposed.

"This is an issue that we have proposed on the part of the Commission in the context of the 18th sanctions package. I expect that it will also arouse interest from other G7 partners and will be the subject of discussion," Dombrovskis said .

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The price cap mechanism allows Western companies to insure and transport Russian oil by sea only if it is purchased below a set price limit. The United States and the European Union also imposed an embargo on most imports after Russia's full-scale invasion of Ukraine.

The price threshold of $60 was set at the end of 2022. The coalition members agreed to regularly review the limit once a month to ensure that it is 5% lower than the average market price of Russian oil and oil products, but they have never done so.

During this time, Russia has learned to circumvent the restrictions by using a "shadow fleet" of tankers, often with unknown insurers or owners, to supply oil to new markets, primarily in Asia. As a result, Russian oil is sold above the established price limit for most of the year.

In April 2025, the price of Russian Urals oil fell below the $60 threshold due to the global price decline.

  • Ukraine has been asking to set the threshold for Russian oil prices at $30 per barrel from the very beginning.