WASHINGTON (AP) — The Treasury Department released new details Tuesday of its long-awaited plan to impose a price cap on Russian oil, but the U.S. and its allies are still finalizing how much they'll pay for petroleum exports that have helped fund the war in Ukraine.

The new guidance is meant to help firms and maritime insurers understand how to abide by the price ceiling, according to a senior Treasury official who discussed the plans on a call with reporters on condition of anonymity.

The official said the plan allows the U.S. and its allies to reduce Russia's revenues while keeping oil on the market. The latest guidance defines what constitutes Russian oil and when the cap applies and states that the price cap could change depending on market conditions.

Oil is one of the Kremlin's main pillars of financial revenue and has kept the Russian economy afloat despite import bans, sanctions and the freezing of central bank assets that began with the February invasion. Russia exports roughly 5 million barrels of oil per day.

A Dec. 5 deadline for setting the price for discounted oil comes just before a year-end wider European embargo on seaborne Russian crude oil and a complete ban on shipping insurance designed to prevent Russian oil from reaching non-European buyers.

European Union officials are set to meet on Wednesday, and the 27-nation bloc will need to come to unanimous agreement on the final price cap number. Treasury has declined to speak about what the range might be, but maintains that the European nations will come up with a final number.

While U.S. Treasury officials and leading economists are confident that the plan will work as planned, others are wary of trying to implement it before winter, in a global economy facing already high inflation and other economic uncertainties.

Former Treasury Secretary Steve Mnuchin called the plan "ridiculous" last week, on a panel at the Milken Institute's Middle East and Africa Summit. Mnuchin told CNBC the idea was "not only not feasible, I think it's the most ridiculous idea I've ever heard."

White House National Security Council spokesman John Kirby said Tuesday that the administration is "trying to be as supportive as we can be, particularly in terms of the implementation" of the price cap.

He added that the administration did not want to get ahead of European allies but reiterated the administration's view that it could be an effective tool against Moscow.

"We believe that this will effectively help prevent Mr. Putin's ability to profiteer off the oil markets ... and fund his war in Ukraine," Kirby said.

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Associated Press reporter Aamer Madhani contributed to this report.