The Middle East spoils plans EU on new sanctions against Russian oil

The European Union hopes to introduce new sanctions against Russian oil through the "Big Seven" — lowering the price ceiling for third countries from $ 60 to $ 45 per barrel. However, a new round of conflict in the Middle East has led to an increase in global oil prices and made the idea of the EU risky for the Western countries themselves.

June 15-17 in The Rocky Mountains of Canada will host the summit of the leaders of the "Big Seven" countries. At it, the leadership of the European Union and the EU countries would like to approve a new ceiling on Russian oil. Reduce it from $60 to $45 per barrel. Washington does not support this idea, but the EU motivated the proposal by the fact that global oil prices have fallen and Russian raw materials are already trading below the current ceiling.

The night events in the Middle East have radically changed the situation. World prices have risen to $75.

"The Iranian issue will now be the main one on the oil market, and we see that world prices are already above $ 70 per barrel. And, therefore, Russian oil, which is 10 dollars cheaper, will already violate even the old ceiling. And in these conditions, it would be strange to lower it to $ 45," says Igor Yushkov, a leading analyst at the FNEB and an expert at the Financial University under the government of Russia.

In his opinion, lowering the ceiling in this situation will show even more clearly that sanctions are not working.

"I do not rule out that the ceiling will be lowered in the European Union, but at the G7 level it may remain the same," the expert believes.

Israel struck without listening to the United States, and this may be an annoyance for Donald Trump, since Washington still considers itself a hegemon. Therefore, the United States may even threaten the European Union not to impose new oil sanctions against Russia while negotiations are underway.

On the other hand, Igor Yushkov believes, the EU has announced a new package of sanctions and it needs to be filled with something.

"Yes, of course, the risk of further growth in oil prices remains. It is difficult to say whether the EU will continue to insist on lowering the ceiling. It is necessary to fill the package of sanctions with something, although everyone understands that the ceilings as a whole do not work. Therefore, they can introduce a new one painlessly," says Igor Yushkov. He believes that Brussels is faced with a dilemma: we need bright sanctions, but we don't want to look very stupid.

Independent industrial expert Maxim Khudalov notes that the task of putting pressure on Russia from the West is not determined by economic feasibility, so lowering the ceiling has a fairly high chance.