Utopia Talk / Politics / Price Cap on Oil

Paramount Member	Sat Dec 03 10:36:27 EU has put a price cap on Russian oil. $60. So what is going happen? Will Russia sell to the EU at that price?
Habebe Member	Sat Dec 03 10:40:26 The same thing will happen when my grandpop put a price cap of $1 for cigarettes. They stopped selling it . US oil price floor is $72 or $75.Which just means The government garauntees to buy X amount if it drips that low or lower to keep them profitable and pumping. This is such a Euro move.
Daemon Member	Sat Dec 03 10:48:17 We'll see what happens, Russia already has to sell at a low price since the war started: http://www...a/urals-brent-price-difference
Paramount Member	Sat Dec 03 11:07:37 I just heard on the news that Russia said that countries that expect to buy oil at a price cap will not receive any oil from Russia. So now what?
jergul large member	Sat Dec 03 11:18:07 The obvious move for Russia is to tax oil exports as if it were being sold at market prices and let the oil companies simply pay a higher tax per barrel than they otherwise would have.
TheChildren Member	Sat Dec 03 11:55:01 what going 2 happen short answer nottin long answer nottin gonna happen they cannot set da prices as if they r in charge. they can only prohibit there own companies from dealin with any dealings unless da price is lower than 60... so this means in da rest of da world, oil is being traded at market prices. while euro companies r crashin from losin out every deal coz those deals r dealin with prices above 60...
Paramount Member	Sat Dec 03 12:52:43 So the price gap is only going to hurt countries in the EU?
Habebe Member	Sat Dec 03 15:27:15 The US should price cap European cars, no more than $12k/car. Even TC knows this is dumb.
TheChildren Member	Sun Dec 04 06:43:52 "So the price gap is only going to hurt countries in the EU? " >> exactly, thats wht i think. theres no way they can dictate what da price is of a global commodity thats been done by everyone else in da world. how can any country even try 2 manipulate this. its complete BS.
Seb Member	Sun Dec 04 07:13:27 Have any of you actually looked at your the scheme actually works and what it does?
Seb Member	Sun Dec 04 07:14:01 *Looked at how
Seb Member	Sun Dec 04 07:18:48 The idea is we want Russian oil on the market, but we don't want them to get lots of profit from it. The scheme leverages the EUs dominant position in the insurance and shipping business, and prevents insurance and shipping business from touching shipments where the price agreed is more than 60usd. There are flaws in the scheme, but it is pretty clear that it is not that dissimilar to prior types of sanction regimes that have leveraged e.g. US dominance of us dollar and thus financial system for trade.
jergul large member	Sun Dec 04 08:46:07 To me it seems like a "something must be done, this is something, therefore we will do it" plan. Downside is that is does not have to impact on Russian State finances at all. The State can simply tax oil as if it was sold for market prices. Then there is the whole thing about making China great again. China is pretty damned close to launching more tonnage a year than the rest of the world combined. Why would it not want to expand into becoming a major insurer and brokerer? Russia does matter as a lever that could propel China to global dominance.
jergul large member	Sun Dec 04 08:53:25 COSCO SHIPPING Energy Transportation Co Owns as many large tankers (160ish) as the top 10 global companies combined.
EuropeanPussy Member	Sun Dec 04 09:52:28 It's not just the EU! http://apn...de1c4934227208bfa68bb7d4c47716 The Group of Seven nations and Australia joined the European Union on Friday in adopting a $60-per-barrel price cap on Russian oil, a key step as Western sanctions aim to reorder the global oil market to prevent price spikes and starve President Vladimir Putin of funding for his war in Ukraine.
Seb Member	Sun Dec 04 14:47:28 Jergul: That's the downside risk - I assume they have done their thinking carefully on that front. My suspicion is that there is something that they thinks makes it difficult to enter the market as a serious competitor. If not though, it is a remarkably dumb way to try and apply leverage. I suspect it may be that they think if the US and EU combined stick to this rule, there is some way they are able to exclude or raise barriers to China getting into the market place in trade to other G7 nations which would do it. What it is not is simply trying to legislate a price that forces Russia to sell specifically to Europe at $60 a barrel which is how the opening posts were treating it. It's an attempt to force a global discount on Russian oil.
jergul large member	Sun Dec 04 16:21:38 There is a barrier. Not too many Ice certified tankers. But that is seasonal.
TheChildren Member	Mon Dec 05 04:07:51 opec determines price of oil, nobody else. this is just a laughable imperialistic attempt with warmongers who still think they rule da world, stompin there feet on da ground coz they aint gettin what they want. so they try 2 force that shit. just laughable. in this world, u have da people who have oil and u have da people who need oil but dunt got it. simple as that.
EuropeanPussy Member	Fri Dec 09 11:15:54 The price of oil falls like a stone! http://markets.businessinsider.com/commodities/oil-price
murder Member	Fri Dec 09 11:58:25 Nice. :o)
EuropeanPussy Member	Sun Dec 11 05:41:20 Crude oil is now cheaper than at the beginning of the year!
murder Member	Sun Dec 11 06:49:10 TheChildren is not going to be happy about this. ;o)
EuropeanPussy Member	Sun Dec 11 06:53:00 But why? China has to import a lot of oil, too, he should be happy that oil is becoming cheaper. China should join the price cap!
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