Biden Says Negotiations on Russian Oil Price Cap are ‘in Play’

Russia says it won't provide oil to countries participating in the price cap

President Biden on Thursday said that negotiations between the US and its allies to set a price cap on Russian oil are “in play” as a December 5th deadline to implement the plan is approaching, Axios reported.

December 5th is the day that the EU’s embargo on Russian oil takes effect, although there are exemptions for some countries, including Hungary. The oil embargo also includes a ban on providing insurance for Russian oil shipments.

The idea of the price cap is to curb Russian profits without taking Russian oil off the market by allowing insurance and other services to continue as long as the crude is sold at a price set by the West.

But the plan is almost certainly doomed to fail as it requires Russia’s cooperation, and Moscow is warning that it will cut off any countries that participate in the price cap. And if Russia retaliates by cutting oil production, it could send global prices skyrocketing. Industry experts also say enforcing the plan will be difficult as it will be hard for insurance companies to know what price the oil is really being sold at.

“We have frequently stated that the implementation of the so-called Russian oil price cap is an anti-market policy that disrupts supply chains and can severely exacerbate the situation on global energy markets. Russia does not intend to supply oil to countries that will join the buyers’ cartel,” Russian Foreign Ministry spokeswoman Maria Zakharova said on Thursday.

According to a report from The New York Times, the US has allowed the EU to take the lead in determining what the price cap will be set at, and EU officials were scheduled to discuss the issue on Thursday. The report said that the EU has been asked to set the price between $65 and $70 per barrel. Over the past three months, Russian crude has traded between $65 and $75 per barrel.

Treasury Secretary Janet Yellen, who has led the push to implement the price cap, said recently that India could continue to purchase oil from Russia at any price, signaling that it may not be enforced on Moscow’s Asian buyers.

Author: Dave DeCamp

Dave DeCamp is the news editor of, follow him on Twitter @decampdave.