Russian oil price cap, EU bans to stoke unprecedented uncertainty - IEA (updated)
15/11/2022 09:02
LONDON, Nov 15 (Reuters) - Looming European Union bans
on seaborne exports of Russian crude oil and products along with
a G7 price cap on those sales will create unprecedented
uncertainty for oil markets already beset by high prices and
deep economic challenges, the International Energy Agency said
on Tuesday.
"The approaching EU embargoes on Russian crude and oil
product imports and a ban on maritime services will add further
pressure on global oil balances, and, in particular, on already
exceptionally tight diesel markets," the Paris-based energy
watchdog said in its monthly oil report.
"A proposed oil price cap may help alleviate tensions, yet a
myriad of uncertainties and logistical challenges remain ... the
range of uncertainty has never been so large."
The EU will ban Russian crude imports by Dec. 5 and Russian
oil products by Feb. 5, depriving Russia of oil revenues and
forcing one of the world's top oil producers and exporters to
seek alternative markets.
A G7 plan intended as a carve out to the full EU embargo
will allow shipping services providers to help export Russian
oil, but only at enforced low prices, is also set to take effect
on Dec. 5.
Russian oil output will fall 1.4 million barrels per day
(bpd) next year as buyers shun their supplies, the IEA added.
The EU bans mean that the bloc will need to replace 1
million bpd of crude and 1.1 million bpd of oil products, the
IEA said, with diesel especially scarce and expensive.
(Reporting by Noah Browning, Editing by Louise Heavens)
((mailto:noah.browning@thomsonreuters.com;))