The G7 countries and Australia agreed on Friday to cap the price of Russian oil at $60 a barrel, following a similar deal reached by European Union member states on Friday, according to a joint statement.
This comes as the US Treasury has said that capping the price of Russian oil achieves our goal of limiting Putin’s main source of income.
The countries of the European Union had agreed in preceded on the principle of limiting the price of Russian oil, but remained suspended due to Poland’s reservation that it wanted a lower price, before withdrawing its objection on Friday, which first allowed an agreement within the bloc and then between the G7 countries and Australia.
The communiqué states that the mechanism will enter in effective Monday with entry in force of the ban imposed by the European Union on the purchase of Russian oil via sea.
Good market offer
A senior US Treasury official said on Friday that the European Union’s cap on the price of Russian crude being transported via sea at $60 a barrel will keep global markets well supplied while “laying the groundwork” for the discounts that have resulted from the threat of tale limit.
The official, who spoke to reporters after hours of attempts by EU governments to get Poland to agree to the cap, said the move would cap Moscow’s oil revenues and deprive it of billions of dollars in the war against the Ukraine.
The official added, “By setting the price at $60 a barrel, we are perpetuating the big discounts that forced[Russian President]Putin to sell Russian oil, discounts that have become present in somehow because the threat of a price ceiling forced Russia to make concessions.” deals with importing countries.
In a separate statement, US Treasury Secretary Janet Yellen said the cap would further limit Russian President Vladimir Putin’s income.
“With the Russian economy already in twitch and his budget shrinking, the cap will immediately squeeze one of Putin’s most important sources of revenue,” he added.
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