G7 leaders pledge to pursue price caps on Russian oil

Members of the G7 on Tuesday agreed to explore the possibility of imposing price caps on Russian oil as they reiterated vows to “impose severe and immediate economic costs” on Russia amid its ongoing war in Ukraine.

Why it matters: Russia is the world’s second-largest crude oil exporter and Europe, unlike the U.S., is hugely reliant on Russian oil, gas and coal, Axios’ Ben Geman writes.

  • While the sanctions imposed on Russia in the wake of its invasion of Ukraine have been severe, the country has nevertheless been able to continue selling oil.

State of play: The G7 leaders said they would consider a “range of approaches” when it comes to Russian oil, according to the leaders’ communique.

  • Among these approaches will be the possibility to ban all transport of Russian oil “unless the oil is purchased at or below a price to be agreed in consultation with international partners,” the G7 leaders said in the communique.
  • “We invite all likeminded countries to consider joining us in our actions,” they added, noting that they have tasked their relevant ministers with further exploring the details of such a move.

Yes, but: The leaders stopped short of introducing new energy sanctions and didn’t include specific details about how a price cap would actually work.

What they’re saying: “We reaffirm our commitment to phase out our dependency on Russian energy. In addition, we will explore further measures to prevent Russia from profiting from its war of aggression,” the communique added.

The big picture: Earlier this week G7 leaders made another effort to impose costs on Russia for its war in Ukraine, by vowing to ban imports of Russian gold, which accounts for roughly $19 billion in revenue per year.

Read More: G7 leaders pledge to pursue price caps on Russian oil

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