The US government on Tuesday released detailed guidelines on how to legally participate in trading or financing Russian oil, and are said to be introducing a price cap. The USA has joined forces with the G-7, European Union, and Australia restricted Russian oil in response to the Russian invasion of Ukraine, limiting Russia’s revenues while preventing a spike in global prices that could hurt consumers globally.
As long as Russian oil is purchased at or below the price cap, trading, financing, shipping, insurance and customs brokering will all be covered and not considered a violation of sanctions. The exact price has not been announced, but it is expected to be above the cost of production and will take into consideration the state of the oil market and how much Russia has earned previously on oil revenues. The cost of oil production varies across different regions in Russia. The IMF estimates the full-cost breakeven price for production of Russian oil is close to $30 to $40 per barrel.
Research and Markets offers more information on this topic: