A price cap on Russian oil aims to starve Putin of cash. But it's largely been untested. Until now
Prices for Russian oil have risen well above a price cap imposed by Western allies as part of sanctions over the invasion of Ukraine
FRANKFURT, Germany (AP) — For months after Ukraine's Western allies limited sales of Russian oil to $60 per barrel, the price cap was still largely symbolic. Most of Moscow's crude — its main moneymaker — cost less than that.
But the cap was there in case oil prices rose — and would keep the Kremlin from pocketing extra profits to fund its war in Ukraine. That time has now come, putting the price cap to its most serious test so far and underlining its weaknesses.
Russia's benchmark oil — often exported with Western ships required to obey sanctions — has traded above the price cap since mid-July, pumping hundreds of millions of dollars a day into the Kremlin's war chest.
With Russia's profits rising, the Israel-Hamas war pushing up global oil prices and evidence that some traders and shippers are evading the cap, the first signs of enforcement are appearing 10 months after the price limit was imposed in December.
