A price cap on Russian oil at $65-$70 isn't low enough reduce Moscow's revenue, RBC's Helima Croft says - 'You are not defunding Vladimir Putin'

• A Russian oil price cap at $65 to $70 a barrel is already about where Moscow is selling its crude, according to RBC's Helima Croft.
• That means a cap at that level won't reduce Russia's revenue and will keep its supplies on the market, she told CNBC.
• European Union officials are meeting Wednesday and could approve a cap along with a price level.

A Russian oil price cap at $65 to $70 a barrel wouldn't be low enough to weaken Moscow's revenue, according to top RBC commodity strategist Helima Croft.

She told CNBC on Wednesday that a cap in that range, which is reportedly being considering by the European Union, is already close to where Moscow sells its oil now, as countries still willing to do business with Russia have been getting steep discounts.

"Effectively what price caps look like for oil is not a measure to reduce Russian revenue, but essentially to keep Russian oil on the market," Croft said.

The comments come as EU officials meet Wednesday and could approve a cap along with a price level. Sources told Bloomberg that a cap at $65-$70 a barrel is well above Russia's cost of production and higher than some countries wanted.

The price cap is due to take effect along since the EU's next round of sanctions on December 5, when imports of Russian seaborne oil will be banned as well as related services for cargoes worldwide.

Croft added that Russian oil production has rebounded sharply and is nearly at levels seen before its invasion of Ukraine.

"You are not reducing Russian revenues. You are potentially averting a market disruption, but you are not defunding Vladimir Putin," she said.