Russian sanctions - lower price cap for Russian crude oil enters into force

Members are reminded that the new price cap for Russian crude under both the UK and EU sanctions regimes is US$47.60 per barrel. Although the United States declined to match their coalition partners and have maintained their price cap at US$60 per barrel, the fact that the Club is an EU entity and also subject to the UK provisions means that in practice cover is only available for voyages where the purchase price of the crude is US$47.60 or less.

The price caps for refined products of US$100 for those products which usually trade at a premium to crude and US$45 for products which usually trade at a discount to crude remain unchanged and consistent across all three sanctions regimes.

There are wind down periods for contracts previously entered into at the prior US$60 per barrel price cap for crude and these are set out in our Notice to Members. In addition, the UK has published some FAQs which can be found here (see questions 154 – 161).

If and when Russian crude markets reach this lower price cap level and make such trades viable under the UK and EU price cap regimes, Members will need to obtain an attestation that the cargo purchase price was US$47.60 or below for each voyage and ensure that this attestation is provided to the Club within 30 days of loading. Failure to do so may jeopardise cover for that voyage.

Members are also reminded of the need to provide details of all Russian voyages to the Club in accordance with the UK’s Spire reporting requirements and to ensure that they have the right to demand “ancillary information” from their counterparties for provision to the Club if requested to do so. Details can be found in our Notice to Members No.3 2024/25.

As always, Members with any questions on this or any other sanctions issue should contact the Managers.