Shortly before the 5 December 2022 ban on maritime services for the transportation of Russian crude oil, the UK, EU and U.S. each published details on the relevant price cap relating to oil products with HS/CN Code 2709 (crude) that are of Russian origin or consigned or exported from Russia.
This follows the recent publications of the UK’s “Maritime Services Prohibition and Oil Price Cap Guidance” and OFAC’s equivalent guidance of 9 September 2022. These were discussed in our earlier client alert.
This client alert addresses the recently announced oil price cap and associated restrictions on maritime services. A further client alert on the updated guidance published by the UK, EU and U.S. will follow shortly.
Maritime transportation and services ban
The UK, EU and U.S. restrictions are materially aligned and effectively prohibit the maritime transportation and services for the supply or delivery of Russian origin or Russian consigned / exported oil for maritime voyages between Russia and a third country or between two third countries. For the purposes of this client alert, “third country” refers to a country that is not the UK, the U.S., Canada, Japan or Australia, or not in the EU.
These restrictions apply from 5 December 2022 for HS/CN Code 2709 products and from 5 February 2023 for HS/CN Code 2710 products of Russian origin or that are Russian consigned or exported from Russia (Restricted Oil Products).
In respect of HS/CN Code 2709 products, there is a wind-down if the oil was loaded onto a ship before 5 December 2022 provided that it is discharged and clears customs in a third country before 19 January 2023.
Permitted maritime transportation and services
The relevant publications on the price cap are as follows:
The maritime transportation and services restrictions do not apply in relation to Restricted Oil Products that fall under HS/CN Code 2709 if the “unit price” (being the price per barrel) of such products is at or below US$60.