Russia says EU price cap exemptions show its oil is still in demand

OPEC+ holds a meeting in Vienna
Deputy Prime Minister of Russia Alexander Novak walks at the Organisation of the Petroleum Exporting Countries (OPEC) headquarters in Vienna, Austria October 5, 2022. REUTERS/Lisa Leutner

Feb 8 (Reuters) - Russian Deputy Prime Minister Alexander Novak said on Wednesday that European Union moves to add what he called "exemptions" to its price cap on oil products showed that Russian oil was still in demand.

"Yesterday we saw another change to the European Union's regulations, the exemptions," he said in comments published by the state-run TASS news agency.

"This once again emphasises that our oil products are in demand in Europe, once European politicians indicated that their actions defy any logic and take such decisions and think how to get out of this situation," he said.

The European Union said last week it agreed to set price caps on Russian refined oil products to limit Moscow's ability to finance its war in Ukraine.

At the same time, the EU introduced several exemptions to the way its price cap works.

It said in its latest guidance update that the price cap would no longer apply after crude oil or petroleum products were released for free circulation in a jurisdiction outside Russia and handed over to the landed purchaser.

The price cap no longer applies to Russian petroleum products when the blending operations in a third country "result in a tariff shift" or changes in the oil product type.

The West also imposed a ban on sea-borne Russian oil purchases in December and a price cap of $60 per barrel, which is still above the current price of Russia's flagship Urals crude blend.

Reporting by Reuters; Editing by Tom Hogue/Andrew Osborn

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