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The G7 nations and Australia on Friday said they had agreed a $60 per barrel price cap on Russian seaborne crude oil after EU members overcame resistance from Poland and hammered out a political agreement earlier in the day.

The EU agreed the price after holdout Poland gave its support, paving the way for formal approval over the weekend.

“The Price Cap Coalition may also consider further action to ensure the effectiveness of the price cap,” the statement read.The price cap, a G7 idea, aims to reduce Russia’s income from selling oil, while preventing a spike in global oil prices after an EU embargo on Russian crude takes effect on December 5.

Polish Ambassador to the EU Andrzej Sados on Friday told reporters Poland had backed the EU deal, which included a mechanism to keep the oil price cap at least 5% below the market rate. European Commission President Ursula von der Leyen said the price cap would significantly reduce Russia’s revenues. Because the most important shipping and insurance firms are based in G7 countries, the price cap would make it very difficult for Moscow to sell its oil for a higher price.

A senior US Treasury Department official told reporters on Friday that the $60 per barrel price cap on Russian seaborne crude oil will keep global markets well supplied while “institutionalizing” discounts created by the threat of such a limit.

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Business Maverick: EU closes in on $60 cap for Russian oil as Poles hold out for tougher actionThe European Union is closing in on a deal to cap the price of Russian crude oil at $60 a barrel, their latest attempt to clinch an agreement before a Monday deadline, according to people familiar with the matter.
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