G7 shelves oil cap reviews as prices soar
Design: Ibrahim Yahya
The Group of Seven (G7) and allies have shelved regular reviews of the Russian oil price cap scheme, people familiar with the matter told Reuters, even though most Russian crude is trading above the limit because of a rally in global crude prices.
Russian producers have found ways to sell oil using fewer Western ships and insurance services, making it difficult for the West to enforce the existing price cap because the companies facilitating the trade are outside of their remit.
The G7 countries along with the EU and Australia imposed the price cap mechanism on Russian oil last December, followed by a cap on fuel from February. Initially, EU countries agreed to review the price cap every two months and to adjust it if necessary while the G7 would review “as appropriate” including “implementation and adherence.”
Read G7-led coalition sets cap on Russian oil
The G7 has not reviewed the cap since March, however, and four people familiar with G7 policies said the group had no immediate plans to look into adjusting the scheme.
Sources said that while some EU countries were keen for a review they said that there was little appetite from the US and G7 members to make changes.
Published in The Express Tribune, September 7th, 2023.
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