Ukraine calls for the ceiling proposed by the West to be halved to $30 a barrel – Russia warns it will not supply countries that impose the ceiling.
“Economic suffocation” in Moscow wants the West to impose a ceiling of $60 per barrel on Russian oil. Ukraine has said the cap proposed by the West should be halved to $30 a barrel, while Russia has warned it will not supply countries that impose the cap.
The ceiling on the price of Russian oil will limit directly the revenues of Russia for the “illegal war in Ukraine,” the US says.
The cap, approved by Western allies on Friday, aims to keep Western countries from paying more from 60 dollars a barrel for Russian oil transported by sea.
The measure – set to take effect on Monday – steps up Western pressure on Russia to invade Ukraine.
The price cap was pushed in September by the G7 group of industrialized countries (US, Canada, UK, France, Germany, Italy, Japan), and the EU, in an attempt to hurt Moscow’s ability to finance the war in Ukraine.
In their joint statement, The G7, the European Union and Australia said the decision was taken to “prevent Russia from benefiting from its war of aggression against Ukraine”.
US Treasury Secretary Janet Yellen commented that the price cap would further limit Russian President Vladimir Putin’s revenue which he is “using to fund his brutal invasion” while avoiding disrupting global supplies that could spike gasoline prices skyrocket around the world.
“With Russia’s economy already shrinking and its budget increasingly tight, the price cap will immediately cut off Putin’s most important source of revenue,” Janet Yellen said in a statement.
For his part, British Chancellor of the Exchequer Jeremy Hunt said the UK “will not waver in its support for Ukraine”, and will continue to look for new ways to “combat Putin’s funding flows”.
Kyiv wants a ceiling of 30 dollars a barrel
The cap on Russian crude oil transported by sea should be lowered at 30 dollars a barrel in order to hurt Russia’s economy more, however today Monday a senior official of the presidency of Ukraine.
“This is what the McFaul-Yermak group proposed, but it would be necessary to lower it to $30 in order to destroy the enemy’s economy faster,” wrote Andriy Yermak, head of Ukraine’s presidential office, in Telegram referring to the international working group on sanctions.
A ceiling on the price of Russian oil at $60 a barrel will be imposed in the coming days after the EU, G7 and Australia reached an agreement on the issue on Friday, three days before the European embargo on Russian oil transported via sea.
Moscow’s threats to cap Russian oil
The reaction was intense of Moscow on the temporary ceiling imposed by the West on Russian oil. The Russian government, through its Russian embassy in Washington, is threatening increased uncertainty and higher costs for consumers.
“The price ceiling for Russian oil, introduced by the United States and its partners, means in practice that the basic principles of the free market are being reshaped,” the Russian embassy in the United States said in a statement.
For his part, the senior Russian official Leonid Slutsky he told the TASS news agency that the EU is “jeopardizing its own energy security with the cap”. According to estimates, while the Western measures will certainly be felt in Russia, the blow will be partly softened by the fact that it also sells oil to other markets such as India and China – currently the largest single buyers of Russian crude .
– AMPE
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