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US announces new sanctions aimed at enforcing price cap on Russian oil

by Nate Ostiller and The Kyiv Independent news desk February 9, 2024 8:56 AM 2 min read
Oil storage tanks stand at the RN-Tuapsinsky refinery, operated by Rosneft, in Tuapse, Russia, on March 22, 2020. Photo for illustrative purposes. (Andrey Rudakov/Bloomberg via Getty Images)
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The U.S. Office of Foreign Assets Control (OFAC) announced new sanctions against four companies and one cargo ship on Feb. 8 for violating the $60-per-barrel price cap on the trade of Russian oil. It is the second such action OFAC has taken in 2024 to try and enforce the price cap.

The Group of Seven (G7) countries vowed to step up enforcement of the price cap, first implemented in December 2022, after Russia has continued to manage to ship out much of its crude above $60 per barrel by using a "ghost fleet" of mostly uninsured tankers.

The U.S. first sanctioned the violators of the price cap in October 2023, targeting two companies and two of their tankers. Several other entities and vessels have been sanctioned over price cap violations since.

The sanctions announced by OFAC on Feb. 8 were targeted at three companies based in the United Arab Emirates (UAE) and one in Liberia. The last company to be sanctioned by OFAC for violating the price cap in January 2024 was also registered in the UAE.

"Russia’s own top energy official admits that the coalition’s price cap and our sanctions have led to widening discounts on Russian oil, limiting the revenue the Kremlin relies on for its illegal war," said Brian Nelson, the Treasury under secretary for terrorism and financial intelligence.

"Today’s action against vessels violating the price cap on Russian oil should serve as a continued warning that we can and will enforce violations of the cap."

OFAC's announcement also included a ban on the import of Russian diamonds.

US announces ban on import of Russian diamonds
The U.S. Office of Foreign Assets Control (OFAC) on Feb. 8 imposed a ban on non-industrial diamonds mined in Russia, prohibiting their export regardless of whether they were processed in Russia or substantially transformed in a third country.

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