G7 Group Say Price Cap for Russian Oil Still On The Front Burner

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………….Price cap aimed at limiting Russia

The foreign ministers of G7 have confirmed that they are still exploring ways of curbing Russia’s huge revenues from oil, including the consideration of a on all services enabling the transportation of Russian oil unless the oil under transportation has a price cap.

The countries, Canada, France, Germany, Italy, Japan, the United Kingdom, and the U.S., and the High Representative of the European Union, have been examining for weeks the possibility of putting a cap on Russian oil.

The ministers said in a statement issued yesterday in the United Kingdom that the option is still on the front burner.

“We further condemn Russian attempts to weaponise its energy exports and use energy as a tool of geopolitical coercion. Russia is therefore not a reliable energy supplier,” the G7 ministers said.

“As we phase out Russian energy from our domestic markets, we will seek to develop solutions that reduce Russian revenues from hydrocarbons, support stability in energy markets, and minimise negative economic impacts, especially on low- and middle-income countries.

“We remain committed to considering a range of approaches, including options for a comprehensive prohibition of all services that enable transportation of Russian seaborne and petroleum products globally, unless the oil is purchased at or below a price to be agreed in consultation with international partners,” the G7 statement stated yesterday

The U.S. Administration has been pushing for weeks to have as many oil buyers as possible agree to a price cap plan, and is reportedly also talking to India and China about potentially joining a price cap mechanism.

Reuters said last week, quoting a senior G7 officials, that the two large Asian importers could be inclined to entertain the idea of a price cap as this would reduce their energy bills.

Meanwhile, Russia’s oil exports appear to have stabilized, based on Bloomberg data released Monday showing a steady level of 500,000 barrels per day below the peak reached prior to the February invasion of Ukraine. 

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