G7 agreed to limit prices of Russian oil
The G7 countries have announced that they plan to introduce price restrictions on global purchases of Russian oil, which should reduce Russia’s oil revenues and weaken its ability to finance the war against Ukraine.
Bloomberg writes about this with reference to the G7 statement, Censor.NET reports from Economic Truth.
"We reaffirm our shared political intent to complete and implement a comprehensive ban on services that enable the maritime transportation of crude oil and petroleum products of Russian origin worldwide," the G7 finance ministers said in a statement.
"The provision of such services will only be permitted if oil and petroleum products are purchased at or below a price (the "price ceiling") set by a broad coalition of countries that observe and implement the price ceiling."
The G7 plan would effectively allow buyers of Russian oil at a capped price to continue receiving critical services such as tanker financing and insurance.
To impose the restrictions, diplomats will have to convince EU countries to amend the sixth package of sanctions against Russia over its invasion of Ukraine, which may not be easy. The package, which bans buying Russian oil from Dec. 5, included a ban on the bloc's companies from providing insurance and financial services related to Russian oil to third countries.
At present, it remains unclear how effective the price cap regime will be, as some of the largest buyers of Russian oil have not agreed to join the initiative. For example, according to the interlocutors of the agency, India fears that it may "lose out" to other buyers in the opportunity to buy Russian oil at reduced prices. Support for major buyers of Russian oil, such as India and Turkey, is seen as particularly important.
At the same time, the US believes that the price cap can work even without the support of such countries, since the G7 will still be able to use the system to influence contract negotiations with Moscow to achieve lower prices.
It will also not be easy to get the full support of the EU. Hungary, which maintains close relations with Russia, has signaled that it will oppose any cap on oil prices.
Russia has already declared that it will not sell oil to countries that set a price cap on its oil. "We simply will not interact with them on such non-market principles," Kremlin press secretary Dmitry Peskov said.
