Russian oil price cap sought by G7 – Reuters

3 mins read

The media outlet claims that the club’s finance ministers would discuss limits on Friday during a virtual meeting.

According to Reuters news agency, which cited unnamed sources, the finance ministers of the Group of Seven countries are likely to come to an agreement on Friday over capping the price they are willing to pay for Russian oil. After an online meeting, the officials are anticipated to announce the broad strokes of a strategy.

An unidentified European G7 official was reported by Reuters as suggesting that “a agreement is likely” in its piece that was published on Friday. However, the same source cautioned that it was unclear how much information would be provided.

On Thursday, British Chancellor of the Exchequer Nadhim Zahawi expressed hope that G7 finance ministers will “have a statement that will mean that we can move forward at pace to deliver this.

Karine Jean-Pierre, a spokesman for the White House, refrained from commenting, saying that she didn’t want to “get ahead of that meeting.”

Following the beginning of its military effort against Ukraine in late February, Russia’s oil export volumes decreased; but, as a result of rising global oil prices, as reported by the International Energy Agency in August, Russia’s earnings increased in June by $700 million from May.

The price cap, which Western leaders in theory agreed to back in June, would set a ceiling on what merchants and refiners may shell out for Russian petroleum. By keeping Russian oil on the market and lowering the Kremlin’s earnings, price surges will be prevented.

Moscow has already stated that it will not comply, choosing to transport its oil to nations that are not subject to the restriction.

Several unidentified G7 officials who spoke to Reuters expressed skepticism on the effectiveness of the limit if it were to be applied just by the group’s members, the US, Britain, Canada, France, Germany, Italy, and Japan. According to them, the G7 would require the support of significant oil users in order for the measure to have an actual impact on Russia’s oil income.

Reuters says it’s doubtful that this will happen. Furthermore, the story noted, citing unnamed analysts, that while almost 95% of the world’s tanker fleet presently rely on London-brokered shipping insurance, it would still be possible to find alternatives.

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