Putin extends until end of 2023 ban on Russian cos selling oil and petroleum products as per price cap - decree

MOSCOW. June 26 (Interfax) - Russian President Vladimir Putin has extended until the end of 2023 the decree banning sales of Russian oil and petroleum products to foreign legal entities and individuals if contracts stipulate the terms and conditions of the price cap set by the United States and a number of other countries.

According to the website of the official publication of legal acts, the decree has been extended until December 31, 2023, from its previous deadline of July 1, 2023.

G7 and EU countries have formed a Price Cap Coalition that bans imports of Russian oil and oil products, but allows ship owners from their countries to transport them and provide brokerage and other services if they are sold for not more than a price cap set by the coalition. The purpose of the embargo and price cap for Russian oil and oil products is to limit Russian budget revenues from the sale of energy, while maintaining supply of oil and oil products to the world market.

The Kremlin considers the price cap to be a non-market instrument. President Putin signed a decree prohibiting the sale of oil within the price cap framework, and the government has issued a resolution that clarifies the terms for applying the decree.

The government resolution states that companies themselves and individuals who have concluded supply contracts are obliged not to allow the presence of price cap provisions in contracts and addendums to them. Also, companies must monitor the non-application of this condition right up to the end customer.

The Energy Ministry monitors prices for Russian oil according to the methodology it has issued. The ministry sends a monthly report to the interdepartmental working group on issues related to activity in the fuel and energy sector no later than the 10th day of the month following the month of the report.