DISINFO: The Western price cap is beneficial to Russia
SUMMARY
The price cap on Russian oil has all the signs of an approaching fiasco. Currently, there is virtually no free oil left on the world's energy market. Therefore, there is a high risk that oil prices will seriously increase after the introduction of restrictions. The price cap of $60 per barrel is beneficial to Russia because the cost of extraction of Russian oil is between $20 and $40.
RESPONSE
Pro-Kremlin disinformation narrative portraying sanctions on Russia as useless, ineffective and destructive to the West.
This claim was made in connection with the recent EU decision to introduce a 60$ price cap for imported Russian oil. This step was taken in order to reduce Russian income from oil exports used by the Kremlin to fuel its war machine.
The price cap is a novel instrument in recent years on the oil market. The impact of the price cap on Russian oil will be evaluated in the longer run.
The cost of extraction of Russian oil varies between 20$ and 50$, while the 2023 Russian budget expects that the average oil price will be around 70$. In this way, the European 60$ price is expected to have a particular negative impact on Russian revenues.
Read also related disinfo cases : The New York Times reports that Russia is barely affected by sanctions, sanctions against Russia worsen the economic crisis in the West, Sanctions are beneficial to Russia so the West should recognise Crimea as Russian, FT: Thanks to sanctions Russian agriculture strengthens its position in the world, The EU lost more from sanctions than Russia, European sanctions against Russia do not work.