G7 to impose sanctions on Russian oil

G7

Group of Seven discuss Russian oil and gas price caps amid energy crisis concerns

Finance ministers from the Group of Seven industrial powers on Friday pledged to impose a cap on the price of Russian oil in a bid to limit the Kremlin’s revenues and ability to fund its war in Ukraine, while also curtailing the war’s impact on energy prices and inflation.

The ministers said they would impose the cap by barring insurance or shipping companies from helping Russia sell oil at prices above the set limit.

The decision follows discussions at the group’s summit earlier this year and aims at solving one of the vexing problems with sanctions against Russia: Global oil prices have risen on fears of restricted supply, which has only fattened the Kremlin’s take.

Russian Deputy Prime Minister Alexander Novak has said Russia will refuse to sell oil to countries or companies that observe the cap.

Meanwhile the EU’s top executive said Friday that the bloc’s electricity market “is no longer operating” amid the Ukraine war, and proposed a price cap on Russian pipeline gas.

European Commission President Ursula von der Leyen blamed Russian President Vladimir Putin’s war against Ukraine for the energy crisis and the dramatic rise in gas and electricity prices.

She said Europe’s priority is to save energy because reserves are scarce, although the 27-nation bloc has already reached its goal of filling gas storage to 80% of capacity ahead of the winter months. The target date was 1 November.