The European Commission’s proposes to lower the cap on Russia’s oil price to $45 per barrel as it unveils the latest, 18th package of sanctions on the rogue state on Tuesday.
The Commission aims further to weaken Russia’s economy by targeting the country’s shadow fleet of oil tankers, the banking sector, and military industry, said Commission President Ursula von der Leyen and Kaja Kallas, High Representative of the European Union for Foreign Affairs and Security Policy and the Commission VP.
Belief in G7
“We are ramping up pressure on Russia because strength is the only language that Russia will understand,” Ms von der Leyen said during a Brussels press meeting.
Lowering the price cap from $60 to $45 per barrel is a response to both Russia’s war intransigency and the market reality of oil prices dropping much lower than at the time the initial cap was introduced.
When asked how much hope she had the US would join the latest round of sanctions—something US President Donald Trump has appeared unwilling to do—Ms von der Leyen replied that she was looking forward to the upcoming G7 annual summit in Canada. The topic is likely to come up during the talks. “We have announced this policy as G7 and I’m confident we will go on as G7,“ she said.
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Death and destruction
Ms von der Leyen mentioned, attepting to justify her optimism in the face of political headwinds, her meeting US Republican Senator Lindsey Graham last week. Mr Graham has been advocating a bill targeting countries buying Russian oil with the Trump administration beloved policy tool, i.e., tariffs.
“We want peace for Ukraine. But despite weeks of diplomatic effort, despite Preisdent Zelensky’s offer of an unconditional ceasefire, Russia continues to bring death and destruction to Ukraine. Russia’s goal is not peace, it is the rule of might,“ the Commission president said.
Ms Kallas, who hails from Estonia, Russia’s neighbour and potential aggression target, spoke in stark tones. “Nothing suggests that Russia is ready for peace. On the contrary, Russia is escalating its war in Ukraine. Maternity hospitals, emergency medical wards, civilian houses, and infrastructure are not military targets. This is an outright illegal war,“ she said.
Sanctions work
On energy, the Commission proposes adding another 77 vessels transporting Russian oil to the list, bringing the total to over 400. It also proposes sanctions on the North Stream pipelines to prevent Russia generating any revenue in the future in this way. “It sends a clear signal we are not going back to business as usual,“ Ms Kallas said.
Russia wants us to believe that they can continue this war forever. This is not simply true. Kaja Kallas, EC Vice-President
„On the banking sector, we are turning the ban on SWIFT messaging services into full transaction ban. We propose 22 new banks to the list of institutions blocked from these transactions,“ the Union’s top diplomat said. „On military industry, we suggest adding 22 new companies, including some from China and Belarus, to the list of entities facing stricter restrictions on the dual use goods. And this brings the total number of targeted companies to over 800,“ she enumerated the measures.
„Russia wants us to believe that they can continue this war forever. This is not simply true. Russia has lost tens of billions in oil revenues, its economy is shrinking, and its GDP has dropped,“ Ms Kallas reiterated in an effort to neutralise Russian-pushed naratives to the contrary.
Putin’s price must go up
„Sanctioning the shadow fleet has been particularly impactful. After our last sanctions package, the 17th sanctions package, the oil exports from Russia via the Black Sea and Baltic Sea routes declined by 30 per cent—in a week. In the month of May alone, Russia’s sovereign wealth fund declined by $6bn, from $42bn to $36bn. And it could run out of money by next year. By cutting off revenue streams, we prevent them from refilling their war chest.“
Ms Kallas concluded her contribution to the press meeting in an emotional tone. “Every day, Russia lies about its desire for peace. Putin is taking the world for a ride. Together with the United States, we can really force Putin to negotiate seriously. Every day, Russia continues its war. Every day the Russians fight this war, the price must go up.“
EU officials say they would like to see the package agreed by EU member states before August.
