This is CBSI in the world. I'm John Batser. Sanctions on Russia, Ukraine conflict.

I welcome Michael Bernstom of the Hoover Institution to help me interpret these headlines,

which all speak to where we are in the sanctions regime to leverage the Kremlin to back off

and make peace. The headline now is US refineries expect Russian fuel sanctions to keep margins

high. This is the refineries. Michael, a very good evening to you. Here to four, we've talked about

the banning of Russian oil sales above a certain price, a price cap that the Europeans impose.

Now we're talking about a price cap on refined fuels. What are refined fuels, Michael? And what does

this mean? There are two kinds of liquid petroleum products, so refined fuels. One is very expensive,

high quality. It is jet fuel, jet diesel and the regular diesel for trucks and cars. Then there are

some cheaper products such as fuel oil and the Europeans and the product called NAFTA, which is used

for plastics. And then there is this gas oil, which is used as a distillant to produce regular gas,

regular gasoline, which means that the European Union and the G7 are talking about two kinds of

price caps. One is hundred dollars per barrel for high quality products for high quality refined

products. And the forty five dollars per barrel for those cheap low quality products. So this

are different products. And now, of course, we're in view of this impending cargo in the price cap.

All globally finer. These are working 24, 7, 3 shifts per, because they can sell now,

because the Europeans are filling up their storages and their inventory, they couldn't buy a Russian

diesel anymore. Who wait? Who wait sold in the last months to Europe? Five point five times more

diesel than they used to sell before. So they're doing very well. Where did they get it? Some of

them they probably sold Russian diesel. The Europeans increased their

purchase of Russian diesel to 1.2 million barrels a day in January, because there will be an

embargo in February. So they increased it. So they're filling up inventory. And of course,

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