Russia’s energy ministry said Tuesday it is working on additional measures to limit discounts on Russia’s oil prices to international standards, after price caps were imposed by the West.
Russia is the world’s second largest oil exporter after Saudi Arabia, with oil and gas sales accounting for nearly half of the country’s state budget revenue.
President Vladimir Putin signed a decree last month that banned the supply of crude oil and oil products for five months from February 1 to countries that followed the cap.
Russian oil traditionally sells at a discount to international benchmarks such as Brent. Discounts have widened following Western sanctions on BFO-URL-NWE, BFO-URL-E Ukraine and Brent is now at $25-$30 a barrel against LCOC1.
“The presidential decree published in December prohibits Russian companies from directly or indirectly referring to illegal price cap limits in any way. The ban extends to any transaction with Russian crude oil to the end user, whose This means not dealing with traders who do so. Do not implement the measure,” the power ministry said in a statement.