A cap on Russian oil prices internationally will be discussed by G7 finance ministers this week, in a move the US hopes will ease pressures on the energy market and limit Russia’s revenues.
US Treasury Secretary Janet Yellen and her counterparts will discuss the measure at a meeting on Friday, according to Bloomberg. The plan provides that those who buy Russian oil at capped prices will continue to receive critical services such as financing and insurance for tankers.
The European Union, the United Kingdom and Switzerland plan to ban their companies from providing these services for Russian oil shipments from December.
“This is the most effective way, we believe, to hit Putin’s revenues hard, and this will result not only in a decrease in Putin’s oil revenues but also in a decrease in global energy prices,” she said on Wednesday. White House Press Secretary. “We will hear more on Friday about how this will work, and we are not alone, we are working with our allies in the G7. So we think this will be a way to really hit Russia economically.”
As Bloomberg notes, it is unclear what the price cap will be or which countries will join the effort.
The US and its allies are looking for the best way to impose sanctions on Russia after the invasion of Ukraine. The G7, which also includes Germany, the UK, France, Italy, Japan and Canada, pledged earlier this year to reduce dependence on Russian energy, including “phasing out or banning the import of Russian oil” .