G7 Nations To 'Urgently' Implement Price Cap On Russian Oil Imports

G7 Nations To 'Urgently' Implement Price Cap On Russian Oil Imports

New Delhi: In a bid to cut a major source of funding for Moscow’s war in Ukraine, G7 industrialised powers on Friday decided to “urgently” move towards implementing a price cap on Russian oil imports, news agency AFP reported.

According to the report, the G7 said it was working towards a “broad coalition” of support, however, officials in France urged caution, saying a “final” call can be taken when 27 members of the European Union had given their assent.

“Russia is benefitting economically from the uncertainty on energy markets caused by the war and is making big profits from the export of oil and we want to counter that decisively,” AFP quoted German Finance Minister Christian Lindner as saying after the move was announced.

The main objective of the price cap was to “stop an important source of financing for the war of aggression and contain the rise in global energy prices”, he said.

Notably, ahead of the decision, Kremlin spokesman Dmitry Peskov had sounded a clear warning, saying the price cap “will lead to a significant destabilisation of the oil markets.”

Moscow would “simply not supply oil and petroleum products to companies or states that impose restrictions,” Russia’s Deputy Prime Minister Alexander Novak said on Thursday, as per the report.

“Interference in the market mechanisms of such an important industry … will only destabilise the oil industry, the oil market. And for this, European and American consumers will be the first to pay,” he said.

Earlier, at a summit in June, the G7 leaders had agreed to work towards implementing the cap on crude sales.

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In their statement, finance ministers from G7 said they would “urgently work on the finalisation and implementation” of the measure without specifying the cap level.

The price cap was “one of the most powerful tools we have to fight inflation and protect workers and businesses in the United States”, US Secretary of the Treasury Janet Yellen said on Friday.

However, the French finance ministry said technical work on the price cap was still “in progress”. “It is clear that no final decision can be taken until we have consulted and obtained unanimous support from all 27 member states of the European Union,” it said.

“We support all measures that reduce the income that Russia derives from the sale of oil,” French Finance Minister Bruno Le Maire added.