European Union bans Russian diesel and other products over Ukraine
The ban comes at the same time that the Group of Seven countries agreed to place a price cap on Russian diesel
February 6, 2023 6:54am
Updated: February 6, 2023 6:54am
The European Union on Sunday imposed a ban on Russian diesel fuel and other refined products in an attempt to hurt the Kremlin’s financial resources nearly a year after the war in Ukraine broke out.
The ban comes at the same time that the Group of Seven (G7) countries—the United States, Britain, Germany, France, Italy, Japan, and Canada—agreed to place a price cap on Russian diesel.
The G7 price cap comes at $100 per barrel of diesel, jet fuel, and petrol. Ships, marine insurers, and shipping services will be prohibited from handling diesel that is priced more than $100.
The sales of oil and natural gas make up a large part of the Russian government's budget. The European Union, the United States, and other allies are tightening sanctions on Russia’s fuel products in order to make it harder for the Kremlin to finance the war in Ukraine.
"The caps we have just set will now serve a critical role in our global coalition's work to degrade Russia's ability to prosecute its illegal war," U.S. Treasury Secretary Janet Yellen said Friday. "Combined with our historic sanctions, we are forcing Putin to choose between funding his brutal war or propping up his struggling economy.".
Energy analysts, however, worry that the measures could cause “significant market dislocations” and might leave Europe struggling to find a fuel supplier. The 27-nation European Union is expected to replace Russian fuel with supplies from the U.S., the Middle East, and India.