G7 agrees to impose price cap on Russian oil

 
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G7 agrees to impose price cap on Russian oil





Members of the G7 have agreed to impose a price cap on Russian oil in a bid to hit Moscow's ability to finance the war in Ukraine.

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Finance ministers said the cap on crude oil and petroleum products would also help reduce global energy prices. The cap will be set at a level based on a range of technical inputs.

"We will continue to stand with Ukraine for as long as it takes," the G7 said.

Russia said it would stop selling oil to countries that imposed price caps.

"Companies that impose a price cap will not be among the recipients of Russian oil," Kremlin spokesman Dmitry Peskov said.

The G7 (Group of Seven) consists of the UK, US, Canada, France, Germany, Italy and Japan. The group is an organisation of the world's seven largest "advanced" economies, which dominate global trade and the international financial system.

At their virtual meeting, the finance ministers said the oil price cap plan was "specifically designed" to reduce Russian revenues and its ability to "fund its war of aggression". They also said they wanted to minimise the damaging economic fallout of the conflict, "especially on low and middle-income countries".

The introduction of a price cap on Russian oil means countries that sign up to the policy will only be permitted to purchase Russian oil and petroleum products transported via sea that are sold at or below the price cap.

In the aftermath of Russia's invasion of Ukraine the price of oil soared and has remained at high levels, meaning Russia has increase its revenues from the fossil fuel despite its export volumes falling.

The EU plans to impose an embargo on Russian crude oil from 5 December. It will apply to crude shipped by tanker and most piped supplies.
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