BREAKING

G7 opposes lowering price of Russian crude oil from $60: WSJ

By Al Mayadeen English
Source: Wall Street Journal
16 Mar 2023 00:23

The price cap coalition, consisting of the G7 industrialized countries, the EU and Australia, will be deciding in the coming weeks whether or not they should recalibrate the sanctions imposed on Russia.

In this photo taken on Wednesday, April 5, 2006, A view of reservoirs of Russian state-controlled oil giant OAO Rosneft, at Priobskoye oil field near Nefteyugansk, in western Siberia, Russia (AP /Misha Japaridze)

The Wall Street Journal reported on Wednesday, citing people familiar with the matter, that the International Group of Seven (G7) industrialized nations have disagreed on lowering the price cap on Russian crude oil currently set at $60 per barrel.

The report states that the European Commission (EC) warned its member states that the decision is owed to a conversation held between EC President Ursula von der Leyen and US President Joe Biden in Washington in the past week, in which Biden told Von der Leyen that the US has no interest in adjusting the price cap.

The price cap coalition, consisting of the G7 industrialized countries, the EU, and Australia, will be deciding in the coming weeks whether or not they should recalibrate the sanctions imposed on Russia.

Latest reports reveal that WTI Crude, a US benchmark, fell below $67 - its lowest price since November 2021.

Chevron CEO Mike Wirth said during a conference at CERAWeek on March 6 that the Russian price cap has generated a large number of obstacles in standard operations for global energy markets.

"There's not a lot of swing capacity, there's not a lot of inventory capacity, so a little bit, and the system normally optimizes within those parameters, but there's now a lot of constraints: you can't sell to this country, you can't buy from that country, can't insure," Wirth said, adding that he does not see the prospect of Europe to become a dependent consumer of Russian gas ever again.

President Vladimir Putin signed a decree on February 1, in retaliation to the price cap, to ban crude oil sales to countries abiding by the Western-led price cap on Russian oil.