Putin bans Russian oil exports to countries that implement price cap

MOSCOW, Dec 27 (AFP) - President Vladimir Putin on Tuesday delivered Russia's long-awaited response to a Western price cap, signing a decree that bans the supply of crude oil and oil products from Feb. 1 for five months to nations that abide by the cap.

The Group of Seven major powers, the European Union and Australia agreed this month to a $60-per-barrel price cap on Russian seaborne crude oil effective from Dec. 5 over Moscow's "special military operation" in Ukraine.

The cap is close to the current price for Russian oil, but well beneath the windfall price Russia was able to sell for this year and that helped offset the impact of financial sanctions on Moscow.

Russia is the world's second largest oil exporter after Saudi Arabia, and a major disruption to its sales would have far reaching consequences for global energy supplies.

The decree, published on a government portal and the Kremlin website, was presented as a direct response to "actions that are unfriendly and contradictory to international law by the United States and foreign states and international organisations joining them".

The cap is close to the current price for Russian oil, but well beneath the windfall price Russia was able to sell for this year and that helped offset the impact of financial sanctions on Moscow.

Russia is the world's second largest oil exporter after Saudi Arabia, and a major disruption to its sales would have far reaching consequences for global energy supplies.

The decree, which includes a clause that allows for Putin to overrule the ban in special cases, stated: "This...comes into force on Feb. 1, 2023, and applies until July 1, 2023."

Crude oil exports will be banned from Feb. 1, but the date for the oil products ban will be determined by the Russian government and could be after Feb. 1.