New Study Points to Russian Oil Price Cap Violations in Russian Pacific

Nearly all fof the oil exported from Kozmino port in the Russian Pacific sold for above the $60 price cap during the first three months of 2023, indicating violations of the G-7 oil price cap on Russian crude, the Kyiv School of Economics Institute in Ukraine said in a study of trade and shipping data. The study also found the "continued and substantial involvement of G7/EU shipping service providers."

The institute recommended steps for G-7 members to address the issue, including performing "risk-based audits of attestations regarding price cap compliance," boosting price cap coalition countries' enforcement across jurisdictions, instituting measures to increase the transparency of transactions that don't involve Western shipping service providers and developing additional administrative capacities for sanctions enforcement. The report also recommended lowering the price cap.

"That a substantial share of voyages from Kozmino involves Western-owned and/or -insured vessels while essentially all transactions show prices above $60/barrel points to potentially considerable price cap violations," the study said. "We recognize that differences in the coverage of exports and shipping datasets exist, but they can only explain part of the inconsistencies identified."