Even though the price of Russian crude keeps rising, the price cap on the country’s oil imposed by the US and its allies is still in effect, according to a senior US Treasury Department official.
Russia’s flagship Urals crude has been quoted above $60 a barrel since the middle of July, and some refined oil products have risen above the limit imposed by the US, the Group of Seven, and the European Union.
The US is pleased that Russia keeps the market well-supplied and does not want to “disrupt the global oil market in a way that could lead to instability,” acting Assistant Secretary for Economic Policy Eric Van Nostrand said in an interview with Bloomberg Television.
The cap is working, he said, adding that it has been in place for nine months. Any violations will be investigated by enforcement authorities from the US and allies.
Van Nostrand added that the US measures the effectiveness of the programme by whether it enables customers around the globe to negotiate greater bargains for Russian supply.
According to Van Nostrand, “We don’t explicitly quantify its success by how many molecules of oil flow beneath the cap. We see it as a market tool to alter the incentives in the oil market.