On January 15, 2026, the United Kingdom and the European Union announced plans to lower the Oil Price Cap on seaborne Russian crude oil from $47.60 to $44.10 per barrel. The change will take effect on January 31, 2026 in the UK and on February 1, 2026 in the EU.
The UK Office of Financial Sanctions Implementation indicated that it was offering businesses a wind-down period that will run from January 31, 2026 to April 16, 2026 to give them time to adjust to this price change and ensure consistent implementation of the price cap by all operators. The wind-down period will apply to contracts with effective dates before January 31, 2026 that are in compliance with the existing price cap of $47.60 per barrel. The price change will apply to all services included in the maritime services ban, including maritime transportation and the provision of brokering services, financial services or funds. OFSI has also published updated guidance, amended General License INT/2024/44238849, and provided updated Frequently Asked Questions 154-161 to help businesses adapt to the lower price cap.
The European Commission not only lowered the Oil Price Cap but also adopted an “automatic and dynamic mechanism” that it will use to reset the price cap on a regular basis. According to the Commission, this was the first time that the new mechanism was used to establish the price cap. The new mechanism, which was adopted on July 17, 2025 as part of the 18th sanctions package, will monitor Russian crude oil prices and calculate the average market price every 22 weeks to ensure that the cap is always 15 percent lower than the average market price for Urals crude in the previous 22-week period. The price cap will be subject to review by the Commission every six months. The Commission also announced that it is providing businesses in the EU with a 90-day transition period after January 15, 2026, that will permit the execution of old contracts concluded under the previous price cap, for a period of 90 days. The Commission has also provided businesses with updated guidance, a Commission Notice, and updated Frequently Asked Questions to facilitate the transition to the new price cap.
UK Maritime Services Bank and Oil Price Cap Industry Guidance | General License – INT/2024/4423849 | UK Financial Sanctions FAQs | European Commission News Article | EU Price Cap Coalition Statements and Guidance | Commission Notice | EU Oil Price Cap FAQs