The G7 countries and Australia introduced price restrictions on Russian oil

Earlier, the European Union announced the limitation of the maximum price for oil of Russian origin.

It will not be possible to transport Russian oil if its price is higher than the set price / photo REUTERS
It will not be possible to transport Russian oil if its price is higher than the set price / photo REUTERS

The “Big Seven” countries and Australia introduced a price cap for oil shipped by sea from the Russian Federation at $60 per barrel.

The price cap will help bring discount Russian oil into global markets and is designed to help protect consumers and businesses from global supply disruptions, US Treasury Secretary Janet Yellen said in a statement.

“This will help us achieve our goal of limiting Russia’s main source of revenue for its illegal war in Ukraine, while maintaining the stability of global oil supplies,” Yellen said.

According to her, low- and middle-income countries, which have already suffered from high energy and food prices, the rise of which was caused by Russia’s war against Ukraine, will especially benefit from price restrictions. A price cap would allow such countries to negotiate greater discounts on Russian oil and benefit from greater stability in global energy markets.

“Today’s action will also help further constrain Russia’s finances and limit the revenues it uses to fund its brutal invasion. With Russia’s economy already shrinking and its budget increasingly weak, the price cap will immediately cut off its most important source of revenue Putin,” said the US Treasury Secretary.

In a joint statement of the G7 countries and Australia, published on the website of the Ministry of Foreign Affairs of Germany , it is noted that the limitation of the price of Russian oil at $60 per barrel is aimed at limiting the profits of the Russian Federation, which it directs to wage an aggressive war against Ukraine, maintain stability in global energy markets and minimize the negative economic consequences of Russian aggression, especially for low- and middle-income countries that have disproportionately felt the impact of Putin’s war.

The statement states that within their jurisdictions, the G7 countries and Australia prohibit them from providing services for the transportation of Russian oil by sea around the world, with the exception of oil of Russian origin, which is purchased at a price of no more than $60 per barrel.

“We reaffirm our intention to phase out Russian-origin crude oil and petroleum products for our domestic markets. This commitment remains unchanged with the implementation of the price cap. Instead, the price cap is intended to allow our service providers to maintain supplies of Russian-origin crude oil and petroleum products in other countries, ensuring a stable supply of energy, but limiting Russia’s income,” the joint statement said.

It is noted that the price restriction for crude oil of Russian origin will come into effect on December 5. A time-limited exemption will apply to oil that has been loaded onto tankers in ports prior to that date.

Commenting on this decision, the Head of the Office of the President of Ukraine Andriy Yermak noted that the maximum price for Russian oil should have been set at $30.

“Everything that the McFaul-Yermak group proposed, although it would have to be reduced to $30 to destroy the enemy’s economy faster. We always achieve our goal, and Russia’s economy will still be destroyed, and Russia itself will pay and be responsible for all crimes. With the tribunal will be the same. They are very afraid of this, because they know that Ukraine will get its way,” Yermak said.

(C)UNIAN 2022

One comment

  1. The markets have already reacted. The price for mafia oil was below the EU’s mark last week already. As usual, the EU moves like molasses in winter.

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