Russia's oil export ban has 'no practical significance': Germany

BERLIN

Moscow’s decision to ban oil sales to countries that impose a price cap on Russian fuel “has no practical significance” for Germany, a government spokesman said on Wednesday.

Russian President Vladimir Putin’s recent decree is not a source of concern for Berlin, Robert Saverin, spokesperson for Germany’s Economic Affairs and Climate Action Ministry, said at a news conference in Berlin.

“I don’t want to say that it is irrelevant, but it has no practical significance. We have been preparing to replace Russian oil exports since early summer,” he said.

“Overall, we have been working to ensure the security of supply. It continues to be assured, regardless of whether this decree has been issued or not.”

Putin signed a decree on Tuesday prohibiting supplies of oil and petroleum products to countries applying a price cap on Russian fuel.

The decree comes into effect on Feb. 1 and will be valid until July 1.

The ban applies to contracts which “expressly or indirectly” contain either the term “price cap” or a mechanism for setting a price limit at any stage of supply from the producer to the end buyer.

Moscow had vowed such a move after the EU and G-7 countries introduced a price cap of $60 per barrel for Russian oil to dent its oil earnings.

The price cap applies to oil shipped by sea and does not affect supplies via pipelines. Hungary, Bulgaria, Slovakia, the Czech Republic, and Croatia are temporarily exempted from applying the measure.