In an effort to restrict Moscow’s capacity to finance its conflict in Ukraine, the Group of Seven (G7) price limitation on Russian seaborne oil went into effect on Monday. However, Russia has stated that it would not comply with the measure, even if it means reducing output.

Russian oil

Along with the EU’s ban on seaborne imports of Russian oil and comparable commitments by the United States, Canada, Japan, and Britain, the price ceiling will be implemented by the G7 countries, the European Union, and Australia.

Given that the major shipping and insurance companies in the world have their headquarters in G7 nations, the cap may make it challenging for Moscow to sell its oil for more money.

The second-largest oil exporter in the world,

The second-largest oil exporter in the world, Russia, declared on Sunday that it would not accept the restriction and would not sell oil that is subject to it, even if it meant reducing output.

Since Soviet scientists discovered oil and gas in the wetlands of Siberia in the decades after World War Two, selling oil and gas to Europe has been one of Russia’s key sources of foreign currency profits.

According to a source who spoke on condition of anonymity given the delicate nature of the topic, a regulation barring Russian traders and businesses from doing business with nations and businesses subject to the quota is in the works.

In essence, a proclamation like that would forbid the export of oil and petroleum goods to nations and businesses that use it.

Following the EU’s approval of the price ceiling

Following the EU’s approval of the price ceiling, Beijing stated on Monday that it will continue its energy cooperation with Russia on the basis of respect and mutual benefit, according to the Russian news agency RIA.

Every two months, the EU and the G7 will review the cap’s level; the first review will take place in mid-January.

The European Commission stated in a statement that “this assessment should take into consideration, the efficacy of the measure, its execution, international adherence and alignment, the possible impact on coalition members and partners, and market developments.

published on December 6th, 2022 in The Express Tribune.

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By Larry

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