US Treasury reveals details of price cap plan

US Treasury reveals details of price cap plan

The price cap that the G7 countries want to impose on Russian oil should be set at fair market value minus any risk premium, said Elizabeth Rosenberg, US Treasury Assistant Secretary for Terrorist Financing and Financial Crime.

The price should also be set above the marginal production cost of Russian oil and take into account historical prices accepted by the Russian market, the official added.

Experts say that could imply a potential cap at around $60 a barrel as Russian Urals crude, based off of benchmark Brent, sold for $50 to $70 a barrel in 2019.

Moreover, countries participating in the price cap plan must deny insurance, finance, brokering and other services for oil cargo priced above a yet to be set price cap.

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