US Treasury Secretary Janet Yellen said on Friday that the new maximum price limits for Russian oil products will depend on the maximum crude price set by a coalition of Western countries last December, while Moscow denounced the new Western move.
Yellen expressed her confidence that the new measure will be decisive in undermining Russia's ability to continue its war on Ukraine, and made it clear that the application of the ceiling will begin on Sunday, with the exception of products loaded before that date.
And the member states of the European Union, the Group of Seven and Australia announced on Friday that they had reached an agreement to set a ceiling for the prices of Russian oil derivatives.
The move is the latest in an international effort to target Moscow's main exports.
The agreement sets a ceiling for the price of a barrel of more expensive oil derivatives, such as diesel fuel, at $100, compared to a ceiling for lower-quality products at $45, according to officials.
Last December, the European Union imposed an embargo on Russian crude that arrives by sea, and set, with its G7 partners, a ceiling of $60 a barrel on exports around the world.
The second EU-wide ban is expected to take effect from Sunday, targeting Russian refined oil products such as gasoline, diesel and heating fuel shipped by sea.
At the same time, the European Union and the Group of Seven agreed to impose a ceiling on the prices of Russian shipments of these products to world markets.
The statement of the Group of Seven and Australia stated that the ceiling will be subject to review next March.
The ceilings were approved in line with a proposal put forward by the European Commission.
In its proposal, the Commission sought to strike a balance between sanctions hardliners, such as Poland and the Baltic states, and those anxious not to completely cut off Russia's oil resources from global markets because that would drive up prices.
Data from the Russian Ministry of Finance, on Friday, showed that Russia's monthly budget revenues from oil and gas decreased last January to their lowest level since August 2020, due to the impact of Western sanctions on its exports.
How will Russia respond?
Meanwhile, the Kremlin denounced the European Union before the ban entered into force, stressing that the move would increase the imbalance in international energy markets.
"We are taking measures to protect our interests from the relevant risks," Russian presidential spokesman Dmitry Peskov told reporters.
Russia's war on Ukraine delivered a severe warning to the European Union, which has relied for years on cheap fossil fuels from Russia for its industries.
Brussels reports that the European Union has given up about 90% of Russian imports under the crude oil embargo, after exceptions were granted for pipeline supplies to non-seaside countries such as Hungary.
European Commission President Ursula von der Leyen estimated Thursday, during a visit to Kiev, that the current ceiling on Russian oil prices costs Moscow about 160 million euros ($175 million) per day.