Group of Seven nations are exploring ways to toughen the price cap on Russian oil as they seek to better target Moscow’s ability to fund its war against Ukraine, according to people familiar with the matter, Report informs via Bloomberg.
Options under consideration range from essentially replacing the mechanism with a full ban on handling Russian crude to lowering the price threshold from the current $60 to about $40, the people said. The people, who spoke on condition of anonymity to discuss sensitive talks, cautioned that discussions were ongoing and there’s no consensus yet on a next step.
Under the existing terms of the price cap, Western operators are permitted to insure and transport Russian oil only if it is sold below the established threshold.
The G7 aims to strike a balance between limiting Russia's revenues and mitigating potential impacts on global oil markets and maritime security.
The cap was originally implemented to curtail Moscow's oil profits while avoiding a surge in global oil prices. With oil prices softening amid projections of a global surplus in 2025, the G7 appears more willing to consider aggressive measures.
Ukraine has also targeted Russia's oil infrastructure through drone strikes, further disrupting production.