The Group of Seven (G7) coalition will keep a $60 per barrel price cap on seaborne Russian oil, a coalition official said, despite rising global crude prices and calls by some countries for a lower price cap to restrict Moscow's revenues.
The G7 and Australia made the decision to maintain the cap over the past few weeks after a review of the $60 price - set in December with an aim to reduce Moscow's ability to finance its war in Ukraine, the official said on condition of anonymity.
It comes after four weeks of gains in benchmark oil prices helped by an output cut announced by OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies led by Russia, as well as a recovery in Chinese consumption.
The market was consolidating on Monday with Brent and US crude futures holding above $80 per barrel.
Russian crude has been selling at a discount of around $30 to Brent, the official said.
Coalition officials concluded the price cap was working to both limit Russian revenue while maintaining energy market stability, but said they would continue coordinating to ensure effective monitoring and enforcement, the official added.
The oil price cap bans G7 and European Union companies from providing transportation, insurance, and financing services for Russian oil and oil products if they are sold above the cap.
The US and Britain have also imposed restrictions on Russian oil imports.
The official noted that a recent International Energy Administration (IEA) report concluded that the G7 sanctions regime had been effective "in not restricting global crude and product supplies, while simultaneously curtailing Russia's ability to generate export revenue."
The IEA said on Friday that Russia's March oil revenue rose by $1 billion month on month to $12.7 billion, but was still 43% lower than a year earlier.
Russian crude exports have been consistent at over 3 million barrels per day and global markets have been steady, the G7 official said.
Russia's oil production is forecast to remain stable until 2025, its Deputy Energy Minister Pavel Sorokin was quoted as saying by Neftegazovaya vertikal magazine.
In another context, Saudi Arabia’s crude oil exports slipped more than 2% in February data from the Joint Organisations Data Initiative (JODI) showed on Monday.
The country’s crude exports fell to 7.46 million barrels per day (bpd) in February from 7.66 million bpd in January.
Meanwhile, the crude product was little changed at 10.45 million bpd in February.
Earlier this month, Saudi Arabia’s energy ministry said that the Kingdom is voluntarily cutting its oil production by 500,000 barrels per day from May until the end of 2023.
Despite the output cut, state oil giant Saudi Aramco will supply full crude contract volumes loading in May to several North Asian buyers, several sources with knowledge of the matter said.
Saudi’s domestic crude refinery throughput decreased by 0.134 million bpd to 2.443 million bpd in February, while direct crude burn rose 17,000 bpd to 329,000 bpd.
Monthly export figures are provided by Riyadh and other members of the Organization of the Petroleum Exporting Countries (OPEC) to JODI, which publishes them on its website.
The International Energy Agency (IEA) said on Friday that it sees 2023 demand at a record 101.9 million barrels per day, up 2 million barrels per day from last year and on par with its prediction last month.
While, the US Energy Information Administration has predicted that non-OPEC countries will account for a higher percentage of oil production gains this year and next, a reversal of the last two years.
