The Group of Seven
major economies wants to impose a price cap on Russian oil
exports. The challenge is enforcing it on buyers worldwide.
The G-7 leaders said Tuesday
after their summit they were
exploring a ban on the provision of maritime services to
tankers carrying Russian oil,
unless the oil were sold below a particular price. Backers say the
proposal would achieve two
goals: cutting Russian oil sales
that are fattening Moscow’s foreign-exchange coffers and lowering global oil prices that have
surged since the war in Ukraine.
Russia, one of the world’s
largest oil exporters, has seen
its oil revenue surge despite
moves by the West to stop
buying Russian crude.
Moscow instead has turned
its shipments to China, India,
Turkey and other developing
nations that have bought huge
quantities of Russian oil since
the war began in February at a
discount of more than 20%,
compared with Western oil
prices.
Russian oil is also still flowing into Europe, which has decided to ban most purchases
of Russian oil but only starting
at the end of the year.
To have an impact, some
analysts say, any price cap
would in theory need to be set
lower than the already discounted price for Russian oil.
“Placing a cap is a very
good idea,” said French President Emmanuel Macron after
the summit. “The difficulty is
technical—Russian oil doesn’t
arrive by a single pipe.”
Mr. Macron said the G-7
economies—the U.S., Japan,
France, the U.K., Germany, Italy
and Canada—aim to assemble
a broad coalition of countries
beyond the G-7 that would
abide by the price cap. That effort could be difficult, a French
official said, because big buyers of oil also produce it.
The G-7 economies are also
discussing using sanctions on
maritime insurance to enforce
the cap on tankers that bring
Russian oil around the world.
Insurance collectives and companies based in the West provide cover for around 90% of
maritime traffic world-wide.