The G7 countries, the group of seven richest industrial nations, will “urgently” introduce a price cap on Russian oil. Ministers released the following state on Friday afternoon.
Following the meeting for the second time this summer, the G7 ministers of the UK, France, Canada, Germany, Italy, Japan and the United States, held a virtual meeting to talk about the ways to alleviate skyrocketing energy prices, which also helps Russia sustains its war effort against Ukraine- by executing a price cap on Russian oil.
The measure is aiming to cut Russian revenue and its capacity to wage war, while also reducing the effects of the war on global energy prices, a burden that weighs specifically on low and middle-income nations.
The measure will permit service providers to continue selling Russian seaborne oil and petroleum products at the price cap or below : “Today we confirm our intention to implement a comprehensive prohibition of services which enable maritime transportation of Russian-origin crude oil and petroleum products globally,” a statement read.
Reaffirming their commitments to phase out Russian oil from domestic market, G7 finance ministers highlighted that the price cap should relieve pressure on global prices and support oil-importing nations globally.
“The price ceiling will be set on the basis of a series of technical data and will be approved by the whole coalition before it is applied,” the seven countries stated. The future prices will be “communicated publicly, in a clear and transparent way.”
While many of the key details of the price cap still need to be worked out, G7 leaders invited all countries to provide input for how to operate the price cap and called for global united approach to implement the measure.
Within the EU, which is a ‘non-enumerated member,’ unanimity among the 27 EU Member States is required to pass the price cap. The G7 aims to align the price cap with the EU’s sixth sanctions package.