The finance ministers of the Group of Seven (G7) want to impose a price cap on Russian oil to prevent Moscow profiting from the effects of its war on Ukraine.
In a joint statement on Friday, the G7 called on all countries that import Russian oil to join this measure.
“We seek a broad coalition to maximise effectiveness,” the statement said.
In essence, the idea is to force Russia to sell oil to big buyers like India for a much lower price in the future.
The hope is that this will, on the one hand, relax the pressure on global oil markets and cushion the impact of the Ukraine war on energy prices.
At the same time, Russia would no longer benefit from increases in the price of oil to fill its war chest.
The statement added that sea transport of crude oil and petroleum products of Russian origin would only be possible worldwide if the oil was purchased below a certain price.
The price cap could work by the West tying important services such as insurance for oil transports to compliance with the regulation.
These are largely in Western hands.
