G7 countries agree to cap the price of Russian oil

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The finance ministers of the G7 group of countries – the United States, Japan, Canada, Germany, France, Italy and the United Kingdom – said they will provide “services that facilitate the maritime transport of crude oil and petroleum products of Russian origin worldwide.” make possible, will prohibit”. “above the price cap. That could block insurance coverage or financing for oil shipments.

The price cap would be set by “a broad coalition” of countries, they said in a joint statement. It would come into effect alongside the European Union’s next set of sanctions, including a ban on overseas imports of Russian oil from December.

Russia had already threatened reprisals by banning oil exports to countries with a price cap.

“We simply will not supply oil and petroleum products to such companies or states that impose restrictions, because we will not be uncompetitive,” Deputy Prime Minister Alexander Novak told reporters on Thursday, according to state news agency TASS.

The Biden administration has been urging governments to introduce a price cap for months. The West has already sanctioned many Russian energy exports, but Moscow continued to earn billions of dollars a month by diverting oil to China and Asia.

“The price cap is specifically designed to reduce Russia’s revenues and Russia’s ability to finance its war of aggression while limiting the impact of the Russian war on global energy prices, especially for low- and middle-income countries,” the ministers said. Finance of the G7.

But the measure still needs work and will be extremely complex to manage. How, when and by how much the price of Russian oil can be capped remains to be seen. It would also need wider international support to be effective.

“[We] urge all countries that still want to import Russian oil and petroleum products to do so only at prices at or below the price ceiling,” the finance ministers said.

Since the beginning of July, oil prices have fallen about 18% in the expectation that the recession will reduce demand, but they are still about 20% higher than a year ago.

“While we have seen energy prices fall in the United States, energy costs remain a concern for Americans and continue to rise globally,” US Treasury Secretary Janet Yellen said in a statement. “This price cap is one of the most powerful tools we have to fight inflation and protect workers and businesses in the United States and worldwide from future price spikes caused by global disruptions.”

Novak called the proposals to impose restrictions “utterly absurd” and said they could destroy the global oil market, TASS reported.

“Such attempts will only destabilize the oil industry and the oil market,” he said.

Russia cuts more gas supplies to Europe as inflation hits record high again

According to the International Energy Agency, flows of crude oil and other oil products to the United States, the United Kingdom, the European Union, Japan and South Korea have fallen by nearly 2.2 million barrels per day since the war started in Ukraine.

But two-thirds of this decline has been diverted to other markets, filling Moscow’s treasury. Export revenues in July were about $19 billion, the IEA said.
Russia’s control of large parts of the global energy supply remains an important challenge six months since the invasion of Ukraine. This week, Russia temporarily halted supplies of natural gas to the region via a vital pipeline and halted all supplies to a French utility company, exacerbating the problems that have pushed European inflation to a record high of 9%.

Russian state energy giant Gazprom said the interruption of supplies through the Nord Stream 1 pipeline was due to a planned shutdown of a few days for maintenance work. It is planned to reopen on Saturday.

— Chris Liakos, Anna Cooban and Manveena Suri contributed to this report.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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