Saturday, November 26, 2022

G7 agrees to impose price cap on Russian oil

BERLIN ( Associated Press) – Finance ministers of industrial powers gathered in a group of seven agreed on Friday to create a system aimed at limiting Russia’s income from oil sales, an idea that leaders of those countries have promised to study. did. June summit.

It aims to reduce Russia’s income and, with it, its ability to finance its war in Ukraine, while limiting the war’s impact on global energy prices, whose escalation has fueled inflation rates around the world.

In a statement issued by Germany, which this year chairs the G7, the ministers said they “reaffirmed their joint political intention to finalize and implement a complete ban on services that use crude oil of Russian origin and allow the sea transport of petroleum products. World”.

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“The provision of these services will be permitted only if oil and oil products are purchased and implemented at a price (‘price cap’) determined by a broad coalition of countries adhering to the price cap,” he said.

The statement did not provide any figures for a possible price range and did not specify when the G7 wants to finalize the plan. “We invite all countries to contribute to the design of the price cap and the application of this important measure,” he said. He called for a “broad coalition to maximize effectiveness”.

During their June summit in Germany, the G7 leaders – Germany, Canada, the United States, France, Britain, Italy and Japan – agreed to study the feasibility of measures to ban imports of Russian oil above a certain price. expressed.

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The price range – promoted by US President Joe Biden – may work because service providers are mostly in the EU or UK and therefore within reach of restrictions. However, to be effective, it would have to include a greater number of importing countries, particularly India, where refiners are buying cheap Russian oil rejected by Western traders.

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