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This action is the first live test of the dynamic price-cap mechanism the 18th sanctions package hard-wired in July 2025 ([[2025-07-18-eu-council-regulation-1494-18th-russia-sanctions-package]]). Rather than a fresh political negotiation, the Commission mechanically applied the formula — 15% discount to the 22-week trailing average Urals price — and published the resulting figure (USD 44.1/bbl) via a Commission Notice, then codified it in Implementing Regulation 2026/124 amending Annex XXVIII of Regulation 833/2014. The cap step is smaller than the initial USD 60 → 47.6 cut (July 2025), consistent with Urals prices drifting lower over the 22-week reference window. The UK Treasury/OFSI applied a matching reduction the same day, preserving G7 coordination on the mechanism (per the Harneys coverage).
A 90-day-equivalent transition applies: contracts signed before 31 January 2026 with cargo offloaded at destination by 16 April 2026 remain grandfathered at USD 47.60/bbl, mirroring the wind-down structure used in the 18th package.
scheduled recalculation since its July 2025 introduction — whether the Commission applies future six-month resets without a fresh political fight (as the 18th package's "Open questions" flagged) can now be assessed against an actual data point.
small relative to the USD 12.4/bbl cut in July 2025; downstream effects on shadow-fleet economics and Indian/Turkish refining margins should be proportionally smaller than the 18th-package shift.
indicates the G7 coordination channel established alongside the 18th package is still functioning routinely rather than requiring ad hoc diplomacy each cycle.
to be applied mechanically or becomes politically contested if Urals prices move sharply (testing the ≤5% no-change clause) is the thing to watch at the next six-month window.
guidance (originally set via the 2022-12-05 OFAC determination) moves in lockstep with the EU/UK dynamic mechanism or remains static.