G 7 Countries Say They Will Set A Price Ceiling On Russian Oil

Comment The leaders of the Group of Seven industrialized nations announced on Friday that they would impose a price ceiling on Russian oil, aiming to undermine the Kremlin’s finances while keeping energy flowing to the West. The price cap plan, a top priority of U.S. Treasury Secretary Janet L. Yellen, aims to reduce the huge energy windfall Russia is using to fund its war in Ukraine without creating price shocks that could cripple the global economy . The G-7 had previously only agreed to explore the price cap proposal, but its statement on Friday was the most significant statement yet that nations would seek to implement a new aggressive policy that would be an unprecedented, internationally coordinated action on energy prices. Top Russian leaders have repeatedly warned they will retaliate against the price cap. Europe remains heavily dependent on Russian energy, and an escalation of hostilities could worsen the economic crisis already facing Western allies. “Today’s action will help deliver a significant blow to the Russian economy and hinder Russia’s ability to fight its unprovoked war in Ukraine and accelerate the deterioration of the Russian economy,” Yellen said in a statement on Friday. “We are already beginning to see the impact of the price cap through Russia’s hasty efforts to negotiate bilateral oil deals at huge discounts.” Janet Yellen’s global campaign to defund Russia’s war machine The G-7 nations – the United States, five of its Western allies and Japan – said in a statement that they plan to impose the price cap by cutting off insurance for all shipments of Russian oil sold above a certain price. This would effectively make it impossible to ship cargo priced above the cap. The maximum price has not yet been announced but is expected to take effect in December, when the shipping ban is also expected to come into effect. Yellen has been pushing the policy for months with her international counterparts, but has faced skepticism and tough questions about exactly how the price ceiling would work. Analysts have raised concerns that the cap could be bypassed if non-G-7 countries – such as China and India – continue to buy Russian oil at a higher price and then sell it back into global markets at a higher price. Other analysts and foreign leaders have expressed concern that Russia could respond by cutting even more sharply its natural gas shipments to Europe, which is already facing a winter in which Germany and other nations will face critical shortages of energy supplies . Despite the recent drop in energy prices, Russia has continued to rake in hundreds of billions of dollars from its oil and gas sales. These energy sales have dramatically undermined the Western sanctions campaign imposed over Russia’s invasion of Ukraine, stabilizing the Kremlin’s finances and giving it the means to continue the war. Energy analysts said Friday’s announcement did little to clarify how the cap would affect international gas and oil prices, noting that crucial details – such as the level of the price cap and the effective date – have not been announced. “The devil is in the details, and few details emerged today,” said Bob McNally, a former energy official in the George W. Bush administration, now at Rapidan Energy Group. “This was a process announcement, which went from exploring a price cap to implementing one.” Senior finance ministry officials told reporters in a phone call on Friday that the allies would set the price ceiling above the cost of production for Russia so that oil would continue to flow to world markets. Officials said they would work to bring other European countries and major economies into the plan. Even if countries such as India and China do not join the price cap, Treasury officials said, the existence of the cap would give other nations more leverage in negotiations with Russia over their energy contracts, which would help achieve the goal of reducing the Kremlin’s revenues. Treasury officials said they have been told by other nations’ leaders that they are already benefiting from the price cap plan because Russia knows it has a dwindling number of potential buyers. Yellen also stressed that the price cap would prove less disruptive to global energy markets than the ban on all Russian oil that Europe is preparing to implement by the end of the year. In June, after weeks of tense negotiations, the European Union agreed to ban oil imports from Russia and banned the insurance and financing of sea transport of Russian oil to third countries. The United States banned imports of Russian oil in March. Janet Yellen’s global campaign to defund Vladimir Putin’s war machine To implement the cap, the G-7 would have to convince EU member states to modify the bloc’s sixth round of sanctions. News of the oil cap comes as the EU considers emergency measures to deal with rising energy prices and prepares for what many fear will be a long, cold winter. EU energy ministers will meet in Brussels on September 9 to discuss calls to reform the bloc’s energy market. Worried about the possibility of higher prices, US officials have pushed hard for the cap, but have faced resistance in Brussels, where some EU diplomats have argued that the cap needs much broader support, particularly from China and India, to be effective. Dmitry Peskov, a spokesman for Russian President Vladimir Putin, warned on Friday that countries participating in the price cap would not receive Russian oil. Peskov said of Western allies: “We simply will not cooperate with them on oil on such non-commercial principles.” Asked about the Kremlin’s threats, a senior Treasury official said Russia is desperate for energy revenue and questioned its credibility, noting that Russian officials have also said they will not invade Ukraine. Ariel Cohen, a senior fellow at the Atlantic Council, said he remained concerned that Putin would respond to the price cap by cutting off Europe from gas shipments, which could worsen the continent’s economic crisis. “We have to be careful not to cause an economic recession in Europe,” Cohen said. “I want to clearly understand where the alternative gas supply will come from. What is the extent of the economic pain that Europe can suffer?’ But Simon Johnson, a professor at the Massachusetts Institute of Technology who specializes in energy policy, stressed that the price cap plan – which would allow Russia to trade oil at a discount – would be less disruptive to global markets than Europe’s previous plan. for a cut from all Russian oil imports. “It shows they want oil flowing, which will keep oil prices lower than they would otherwise be,” Johnson said.

title: “G 7 Countries Say They Will Set A Price Ceiling On Russian Oil Klmat” ShowToc: true date: “2022-11-12” author: “Michelle Esqueda”

Comment The leaders of the Group of Seven industrialized nations announced on Friday that they would impose a price ceiling on Russian oil, aiming to undermine the Kremlin’s finances while keeping energy flowing to the West. The price cap plan, a top priority of U.S. Treasury Secretary Janet L. Yellen, aims to reduce the huge energy windfall Russia is using to fund its war in Ukraine without creating price shocks that could cripple the global economy . The G-7 had previously only agreed to explore the price cap proposal, but its statement on Friday was the most significant statement yet that nations would seek to implement a new aggressive policy that would be an unprecedented, internationally coordinated action on energy prices. Top Russian leaders have repeatedly warned they will retaliate against the price cap. Europe remains heavily dependent on Russian energy, and an escalation of hostilities could worsen the economic crisis already facing Western allies. “Today’s action will help deliver a significant blow to the Russian economy and hinder Russia’s ability to fight its unprovoked war in Ukraine and accelerate the deterioration of the Russian economy,” Yellen said in a statement on Friday. “We are already beginning to see the impact of the price cap through Russia’s hasty efforts to negotiate bilateral oil deals at huge discounts.” Janet Yellen’s global campaign to defund Russia’s war machine The G-7 nations – the United States, five of its Western allies and Japan – said in a statement that they plan to impose the price cap by cutting off insurance for all shipments of Russian oil sold above a certain price. This would effectively make it impossible to ship cargo priced above the cap. The maximum price has not yet been announced but is expected to take effect in December, when the shipping ban is also expected to come into effect. Yellen has been pushing the policy for months with her international counterparts, but has faced skepticism and tough questions about exactly how the price ceiling would work. Analysts have raised concerns that the cap could be bypassed if non-G-7 countries – such as China and India – continue to buy Russian oil at a higher price and then sell it back into global markets at a higher price. Other analysts and foreign leaders have expressed concern that Russia could respond by cutting even more sharply its natural gas shipments to Europe, which is already facing a winter in which Germany and other nations will face critical shortages of energy supplies . Despite the recent drop in energy prices, Russia has continued to rake in hundreds of billions of dollars from its oil and gas sales. These energy sales have dramatically undermined the Western sanctions campaign imposed over Russia’s invasion of Ukraine, stabilizing the Kremlin’s finances and giving it the means to continue the war. Energy analysts said Friday’s announcement did little to clarify how the cap would affect international gas and oil prices, noting that crucial details – such as the level of the price cap and the effective date – have not been announced. “The devil is in the details, and few details emerged today,” said Bob McNally, a former energy official in the George W. Bush administration, now at Rapidan Energy Group. “This was a process announcement, which went from exploring a price cap to implementing one.” Senior finance ministry officials told reporters in a phone call on Friday that the allies would set the price ceiling above the cost of production for Russia so that oil would continue to flow to world markets. Officials said they would work to bring other European countries and major economies into the plan. Even if countries such as India and China do not join the price cap, Treasury officials said, the existence of the cap would give other nations more leverage in negotiations with Russia over their energy contracts, which would help achieve the goal of reducing the Kremlin’s revenues. Treasury officials said they have been told by other nations’ leaders that they are already benefiting from the price cap plan because Russia knows it has a dwindling number of potential buyers. Yellen also stressed that the price cap would prove less disruptive to global energy markets than the ban on all Russian oil that Europe is preparing to implement by the end of the year. In June, after weeks of tense negotiations, the European Union agreed to ban oil imports from Russia and banned the insurance and financing of sea transport of Russian oil to third countries. The United States banned imports of Russian oil in March. Janet Yellen’s global campaign to defund Vladimir Putin’s war machine To implement the cap, the G-7 would have to convince EU member states to modify the bloc’s sixth round of sanctions. News of the oil cap comes as the EU considers emergency measures to deal with rising energy prices and prepares for what many fear will be a long, cold winter. EU energy ministers will meet in Brussels on September 9 to discuss calls to reform the bloc’s energy market. Worried about the possibility of higher prices, US officials have pushed hard for the cap, but have faced resistance in Brussels, where some EU diplomats have argued that the cap needs much broader support, particularly from China and India, to be effective. Dmitry Peskov, a spokesman for Russian President Vladimir Putin, warned on Friday that countries participating in the price cap would not receive Russian oil. Peskov said of Western allies: “We simply will not cooperate with them on oil on such non-commercial principles.” Asked about the Kremlin’s threats, a senior Treasury official said Russia is desperate for energy revenue and questioned its credibility, noting that Russian officials have also said they will not invade Ukraine. Ariel Cohen, a senior fellow at the Atlantic Council, said he remained concerned that Putin would respond to the price cap by cutting off Europe from gas shipments, which could worsen the continent’s economic crisis. “We have to be careful not to cause an economic recession in Europe,” Cohen said. “I want to clearly understand where the alternative gas supply will come from. What is the extent of the economic pain that Europe can suffer?’ But Simon Johnson, a professor at the Massachusetts Institute of Technology who specializes in energy policy, stressed that the price cap plan – which would allow Russia to trade oil at a discount – would be less disruptive to global markets than Europe’s previous plan. for a cut from all Russian oil imports. “It shows they want oil flowing, which will keep oil prices lower than they would otherwise be,” Johnson said.

title: “G 7 Countries Say They Will Set A Price Ceiling On Russian Oil Klmat” ShowToc: true date: “2022-11-08” author: “Valerie Weil”

Comment The leaders of the Group of Seven industrialized nations announced on Friday that they would impose a price ceiling on Russian oil, aiming to undermine the Kremlin’s finances while keeping energy flowing to the West. The price cap plan, a top priority of U.S. Treasury Secretary Janet L. Yellen, aims to reduce the huge energy windfall Russia is using to fund its war in Ukraine without creating price shocks that could cripple the global economy . The G-7 had previously only agreed to explore the price cap proposal, but its statement on Friday was the most significant statement yet that nations would seek to implement a new aggressive policy that would be an unprecedented, internationally coordinated action on energy prices. Top Russian leaders have repeatedly warned they will retaliate against the price cap. Europe remains heavily dependent on Russian energy, and an escalation of hostilities could worsen the economic crisis already facing Western allies. “Today’s action will help deliver a significant blow to the Russian economy and hinder Russia’s ability to fight its unprovoked war in Ukraine and accelerate the deterioration of the Russian economy,” Yellen said in a statement on Friday. “We are already beginning to see the impact of the price cap through Russia’s hasty efforts to negotiate bilateral oil deals at huge discounts.” Janet Yellen’s global campaign to defund Russia’s war machine The G-7 nations – the United States, five of its Western allies and Japan – said in a statement that they plan to impose the price cap by cutting off insurance for all shipments of Russian oil sold above a certain price. This would effectively make it impossible to ship cargo priced above the cap. The maximum price has not yet been announced but is expected to take effect in December, when the shipping ban is also expected to come into effect. Yellen has been pushing the policy for months with her international counterparts, but has faced skepticism and tough questions about exactly how the price ceiling would work. Analysts have raised concerns that the cap could be bypassed if non-G-7 countries – such as China and India – continue to buy Russian oil at a higher price and then sell it back into global markets at a higher price. Other analysts and foreign leaders have expressed concern that Russia could respond by cutting even more sharply its natural gas shipments to Europe, which is already facing a winter in which Germany and other nations will face critical shortages of energy supplies . Despite the recent drop in energy prices, Russia has continued to rake in hundreds of billions of dollars from its oil and gas sales. These energy sales have dramatically undermined the Western sanctions campaign imposed over Russia’s invasion of Ukraine, stabilizing the Kremlin’s finances and giving it the means to continue the war. Energy analysts said Friday’s announcement did little to clarify how the cap would affect international gas and oil prices, noting that crucial details – such as the level of the price cap and the effective date – have not been announced. “The devil is in the details, and few details emerged today,” said Bob McNally, a former energy official in the George W. Bush administration, now at Rapidan Energy Group. “This was a process announcement, which went from exploring a price cap to implementing one.” Senior finance ministry officials told reporters in a phone call on Friday that the allies would set the price ceiling above the cost of production for Russia so that oil would continue to flow to world markets. Officials said they would work to bring other European countries and major economies into the plan. Even if countries such as India and China do not join the price cap, Treasury officials said, the existence of the cap would give other nations more leverage in negotiations with Russia over their energy contracts, which would help achieve the goal of reducing the Kremlin’s revenues. Treasury officials said they have been told by other nations’ leaders that they are already benefiting from the price cap plan because Russia knows it has a dwindling number of potential buyers. Yellen also stressed that the price cap would prove less disruptive to global energy markets than the ban on all Russian oil that Europe is preparing to implement by the end of the year. In June, after weeks of tense negotiations, the European Union agreed to ban oil imports from Russia and banned the insurance and financing of sea transport of Russian oil to third countries. The United States banned imports of Russian oil in March. Janet Yellen’s global campaign to defund Vladimir Putin’s war machine To implement the cap, the G-7 would have to convince EU member states to modify the bloc’s sixth round of sanctions. News of the oil cap comes as the EU considers emergency measures to deal with rising energy prices and prepares for what many fear will be a long, cold winter. EU energy ministers will meet in Brussels on September 9 to discuss calls to reform the bloc’s energy market. Worried about the possibility of higher prices, US officials have pushed hard for the cap, but have faced resistance in Brussels, where some EU diplomats have argued that the cap needs much broader support, particularly from China and India, to be effective. Dmitry Peskov, a spokesman for Russian President Vladimir Putin, warned on Friday that countries participating in the price cap would not receive Russian oil. Peskov said of Western allies: “We simply will not cooperate with them on oil on such non-commercial principles.” Asked about the Kremlin’s threats, a senior Treasury official said Russia is desperate for energy revenue and questioned its credibility, noting that Russian officials have also said they will not invade Ukraine. Ariel Cohen, a senior fellow at the Atlantic Council, said he remained concerned that Putin would respond to the price cap by cutting off Europe from gas shipments, which could worsen the continent’s economic crisis. “We have to be careful not to cause an economic recession in Europe,” Cohen said. “I want to clearly understand where the alternative gas supply will come from. What is the extent of the economic pain that Europe can suffer?’ But Simon Johnson, a professor at the Massachusetts Institute of Technology who specializes in energy policy, stressed that the price cap plan – which would allow Russia to trade oil at a discount – would be less disruptive to global markets than Europe’s previous plan. for a cut from all Russian oil imports. “It shows they want oil flowing, which will keep oil prices lower than they would otherwise be,” Johnson said.

title: “G 7 Countries Say They Will Set A Price Ceiling On Russian Oil Klmat” ShowToc: true date: “2022-11-17” author: “Sarah Mims”

Comment The leaders of the Group of Seven industrialized nations announced on Friday that they would impose a price ceiling on Russian oil, aiming to undermine the Kremlin’s finances while keeping energy flowing to the West. The price cap plan, a top priority of U.S. Treasury Secretary Janet L. Yellen, aims to reduce the huge energy windfall Russia is using to fund its war in Ukraine without creating price shocks that could cripple the global economy . The G-7 had previously only agreed to explore the price cap proposal, but its statement on Friday was the most significant statement yet that nations would seek to implement a new aggressive policy that would be an unprecedented, internationally coordinated action on energy prices. Top Russian leaders have repeatedly warned they will retaliate against the price cap. Europe remains heavily dependent on Russian energy, and an escalation of hostilities could worsen the economic crisis already facing Western allies. “Today’s action will help deliver a significant blow to the Russian economy and hinder Russia’s ability to fight its unprovoked war in Ukraine and accelerate the deterioration of the Russian economy,” Yellen said in a statement on Friday. “We are already beginning to see the impact of the price cap through Russia’s hasty efforts to negotiate bilateral oil deals at huge discounts.” Janet Yellen’s global campaign to defund Russia’s war machine The G-7 nations – the United States, five of its Western allies and Japan – said in a statement that they plan to impose the price cap by cutting off insurance for all shipments of Russian oil sold above a certain price. This would effectively make it impossible to ship cargo priced above the cap. The maximum price has not yet been announced but is expected to take effect in December, when the shipping ban is also expected to come into effect. Yellen has been pushing the policy for months with her international counterparts, but has faced skepticism and tough questions about exactly how the price ceiling would work. Analysts have raised concerns that the cap could be bypassed if non-G-7 countries – such as China and India – continue to buy Russian oil at a higher price and then sell it back into global markets at a higher price. Other analysts and foreign leaders have expressed concern that Russia could respond by cutting even more sharply its natural gas shipments to Europe, which is already facing a winter in which Germany and other nations will face critical shortages of energy supplies . Despite the recent drop in energy prices, Russia has continued to rake in hundreds of billions of dollars from its oil and gas sales. These energy sales have dramatically undermined the Western sanctions campaign imposed over Russia’s invasion of Ukraine, stabilizing the Kremlin’s finances and giving it the means to continue the war. Energy analysts said Friday’s announcement did little to clarify how the cap would affect international gas and oil prices, noting that crucial details – such as the level of the price cap and the effective date – have not been announced. “The devil is in the details, and few details emerged today,” said Bob McNally, a former energy official in the George W. Bush administration, now at Rapidan Energy Group. “This was a process announcement, which went from exploring a price cap to implementing one.” Senior finance ministry officials told reporters in a phone call on Friday that the allies would set the price ceiling above the cost of production for Russia so that oil would continue to flow to world markets. Officials said they would work to bring other European countries and major economies into the plan. Even if countries such as India and China do not join the price cap, Treasury officials said, the existence of the cap would give other nations more leverage in negotiations with Russia over their energy contracts, which would help achieve the goal of reducing the Kremlin’s revenues. Treasury officials said they have been told by other nations’ leaders that they are already benefiting from the price cap plan because Russia knows it has a dwindling number of potential buyers. Yellen also stressed that the price cap would prove less disruptive to global energy markets than the ban on all Russian oil that Europe is preparing to implement by the end of the year. In June, after weeks of tense negotiations, the European Union agreed to ban oil imports from Russia and banned the insurance and financing of sea transport of Russian oil to third countries. The United States banned imports of Russian oil in March. Janet Yellen’s global campaign to defund Vladimir Putin’s war machine To implement the cap, the G-7 would have to convince EU member states to modify the bloc’s sixth round of sanctions. News of the oil cap comes as the EU considers emergency measures to deal with rising energy prices and prepares for what many fear will be a long, cold winter. EU energy ministers will meet in Brussels on September 9 to discuss calls to reform the bloc’s energy market. Worried about the possibility of higher prices, US officials have pushed hard for the cap, but have faced resistance in Brussels, where some EU diplomats have argued that the cap needs much broader support, particularly from China and India, to be effective. Dmitry Peskov, a spokesman for Russian President Vladimir Putin, warned on Friday that countries participating in the price cap would not receive Russian oil. Peskov said of Western allies: “We simply will not cooperate with them on oil on such non-commercial principles.” Asked about the Kremlin’s threats, a senior Treasury official said Russia is desperate for energy revenue and questioned its credibility, noting that Russian officials have also said they will not invade Ukraine. Ariel Cohen, a senior fellow at the Atlantic Council, said he remained concerned that Putin would respond to the price cap by cutting off Europe from gas shipments, which could worsen the continent’s economic crisis. “We have to be careful not to cause an economic recession in Europe,” Cohen said. “I want to clearly understand where the alternative gas supply will come from. What is the extent of the economic pain that Europe can suffer?’ But Simon Johnson, a professor at the Massachusetts Institute of Technology who specializes in energy policy, stressed that the price cap plan – which would allow Russia to trade oil at a discount – would be less disruptive to global markets than Europe’s previous plan. for a cut from all Russian oil imports. “It shows they want oil flowing, which will keep oil prices lower than they would otherwise be,” Johnson said.