Countries of the European Union on Wednesday failed for the third consecutive day to reach an agreement on a new package of sanctions against Russia, prompting a temporary extension of the EU’s price cap on Russian crude oil for another week.
Ambassadors postponed further discussions on sanctions until July 22, agreeing to maintain the oil price cap at 44.10 dollars per barrel until July 23, according to two EU diplomats familiar with the situation. Ireland, which currently holds the EU Council presidency, has scheduled a new meeting of EU ambassadors for July 22.
If another extension is not granted next week, the price cap will automatically increase as oil prices have risen due to escalating tensions surrounding Iran, potentially leading to significant profits for Russian President Vladimir Putin. The European Commission is legally required to recalculate the price cap after July 15, but the new price will only take effect on August 1, allowing the executive body some flexibility. This marks the third consecutive day that EU ministers or ambassadors have convened without reaching an agreement on the 21st round of sanctions in response to Russia’s full-scale aggression against Ukraine. The EU is striving to maintain unity on these restrictions.
Meanwhile, Ukraine continues its campaign of drone strikes, inflicting significant losses on Russia and targeting locations deep within its territory, including several oil refineries. These attacks have resulted in a fuel shortage in Russia, prompting Moscow to seek diesel fuel imports from global markets.
Obstacles to unity
Since sanctions require unanimous approval from all 27 EU member states, national governments can impose conditions for their agreement, often demanding other concessions. Hungarian Prime Minister Viktor Orban has a history of blocking decisions to support Ukraine, although there was hope that Budapest would be less obstructive after Peter Magyar took over this year. However, this time Austria and Greece have also raised objections, complicating negotiations.
Vienna proposed a deal in which the Austrian Raiffeisen Bank would receive compensation for what it claims is the illegal expropriation of its Russian operations valued at 2.44 billion euros. This demand would involve the seizure and sale of frozen Russian assets worth 2.1 billion euros located in Austria, belonging to a company linked to Russian oligarch Oleg Deripaska. Proponents of the plan argue that a significant portion of the recovered funds will be invested in a Ukraine recovery fund. In the long term, Vienna hopes this step will deter Moscow from re-seizing Russian subsidiaries of EU companies. Although other ambassadors were hesitant to support this proposal, three individuals familiar with the negotiations told Politico that a solution was reached on Tuesday, but declined to provide further details.
Meanwhile, Greece has expressed concerns about previous EU restrictions on trade in Russian liquefied natural gas following a ban agreed upon in October 2025. These issues remain unresolved, according to sources who requested anonymity to discuss closed-door negotiations. Previous changes to the 21st sanctions package included the cancellation of a proposed ban on imports of Russian fish and the easing of restrictions on visa issuance to former Russian military personnel.
Despite repeated delays, the 21st package is generally considered robust. It includes the addition of 250 new individuals to the sanctions list involved in Russia’s military efforts, as well as sanctions targeting more banks and vessels linked to oil smuggling.
Source: Politico
