Compliance alert: G7+ oil price cap risks
12 Jul 2024
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On 17 May 2024, the European Commission issued an alert regarding potential circumvention of price caps on Russian-origin crude oil and petroleum products, specifically Urals and Eastern Siberia Pacific Ocean crudes. This alert highlights the risks of trading Russian oil near the US$60 per barrel cap amid fluctuating global oil prices.
Key points
- New requirements: Since 20 February 2024, the G7+ Price Cap Coalition mandates EU operators to collect detailed cost information and attestations for each oil shipment within 30 days of loading.
- Risk mitigation: EU operators must assess and mitigate circumvention risks relevant to their business models, adapting due diligence practices to current global oil price trends.
- Compliance: National authorities are urged to detect and address potential breaches or circumvention of the price cap within their jurisdictions.
EU operators must remain vigilant and ensure compliance with these regulations to avoid penalties and support the integrity of the price cap mechanism.
The EU Commission’s press release can be found here and the compliance alert can be found here.
