EU Agrees to Cap Russian Oil at $60 per Barrel

European Union flags fly outside the European Commission headquarters in Brussels (Reuters)
European Union flags fly outside the European Commission headquarters in Brussels (Reuters)
TT
20

EU Agrees to Cap Russian Oil at $60 per Barrel

European Union flags fly outside the European Commission headquarters in Brussels (Reuters)
European Union flags fly outside the European Commission headquarters in Brussels (Reuters)

European countries agreed to cap Russian oil price at $60 per barrel to further weaken Moscow's ability to finance its war in Ukraine.

With this agreement, the bloc countries joined their allies in the Group of Seven (G7), especially the US, UK, and Australia, after Poland obstructed the measure before it withdrew its objection on Friday evening.

The cap is set to be implemented starting Monday when the European Union's embargo on Russian seaborne crude goes into force.

Energy expert Phuc-Vinh Nguyen of Jacques Delors Institute said Russia had earned $71 billion selling oil to EU clients since its February invasion of Ukraine.

Russia's annual defense budget is estimated at $63 billion.

"We can formally agree to the decision," Poland's EU ambassador, Andrzej Sados, told reporters after his country pressed to set a lower price, according to Agence France-Presse (AFP).

The EU presidency, currently held by the Czech Republic, confirmed member state ambassadors had agreed on the price cap and that the decision would enter into force when published in the EU official journal this weekend.

On Friday, the White House also "welcomed" the agreement, and National Security Council spokesman John Kirby told reporters Friday that "the cap itself will have the desired effect on limiting Putin's ability to profit off of oil sales and limit his ability to continue to use that money to fund his war machine."

The EU sanctioned Russian oil traveling by sea beyond the $60 limit to curb the revenue Moscow earns from deliveries to countries such as China or India.

The measure will enhance the effectiveness of the European ban, which comes months after the US and Canada ban.

Russia is the second largest exporter of crude oil in the world. Without setting a ceiling, it will be straightforward for them to reach new buyers at market prices.



Kuwait, China Sign Contract for Mubarak Al-Kabeer Port Study and Design

A general view of the city of Kuwait (Reuters)
A general view of the city of Kuwait (Reuters)
TT
20

Kuwait, China Sign Contract for Mubarak Al-Kabeer Port Study and Design

A general view of the city of Kuwait (Reuters)
A general view of the city of Kuwait (Reuters)

Kuwait's Ministry of Public Works said on Sunday it signed a contract with a subsidiary of the Chinese Ministry of Transport to conduct studies, design plans, and provide pre-implementation services for the completion of the Mubarak Al-Kabeer Port project.

The Mubarak Al-Kabeer port is a vital strategic project located on the eastern side of Boubyan Island in North Kuwait that aims to establish a secure regional corridor and a commercial hub in the region.

The Chinese side seeks to link the port to the Belt and Road Initiative.

In January, the Kuwaiti Cabinet approved the direct contracting process with the China State Construction and Communications Corporation Limited, affiliated with the Chinese Ministry of Transport, to implement, manage and operate the Mubarak Al-Kabeer Port throughout its entire phases.

Kuwaiti Minister of Public Works Noura Al-Mashaan said the project aims to establish a commercial port in Kuwait to serve as a regional transportation hub within the strategic transformation vision of New Kuwait 2035, designed to develop the northern region as an integrated economic and urban system based on a comprehensive and integrated development vision that considers all economic and urban aspects.

She added that the project will significantly contribute to diversifying and increasing the gross domestic product and restoring Kuwait to its regional commercial and financial role.

Kuwait says that around 50% of the first phase of Mubarak Al-Kabeer Port is complete. It does not specify the nature of this phase or the cost of the project.

Kuwait signed multiple MoUs with China during Sheikh Mishal Al-Ahmad Al-Sabah’s visit to Beijing while he was Crown Prince, before becoming Emir in December 2023. Among these agreements, the Mubarak Al-Kabeer Port project was the largest.

In a separate development, Kuwait’s Finance Minister Noura Al-Fassam said on Sunday the public debt law is in its final stages and will be submitted to the government for approval.

She said the law will enable the government to borrow from international markets and will use the funds for financing infrastructure developments and increase state capital expenditure to develop the economy.

Al-Fassam, who is also Minister of State for Economic Affairs and Investment, said that the Kuwaiti state budget for the 2025/2026 fiscal year is indicative of the government’s commitment towards financial “balance” that can only be achieved after implementing economic reforms.

She said the bulk of planned spending for the 2025/2026 fiscal year will be on some 90 key infrastructure and development projects, running the gamut from education and healthcare to tourism and culture.

The Minister noted that a state hiring boom could be a potential by-product of the state budget, which is expected to provide 15,853 jobs.