G7 Agrees to Cap Price of Seaborne Russian Oil at $60 per Barrel

On Friday, the U.S. Treasury Department announced that the G7, European Union and Australia jointly set a cap price on Seaborne Russian oil at $60 per barrel.

Since Russia’s invasion of Ukraine, sanctions have been imposed on Russia by the United States and other Western countries, including cutting off Russia’s oil trade and blocking Putin’s access to war funding. President Joe Biden signed a ban on U.S. imports of Russian oil and gas on March. Russia is one of the world’s top three oil producers and exporters. To avoid the oil supply shortage caused by sanctions against Russia that would affect the global market, the G7 announced this summer that it agreed to a price cap, and non-member Australia also agreed.

U.S. Treasury Secretary Janet Yellen said that the cap price on Russian oil would directly interrupt Putin’s most important source of revenue while ensuring a stable global energy supply.

The price cap will come into effect on Monday. Under the price cap, participating governments will block companies under their jurisdiction from providing insurance, trading, and other services for Russian oil shipments above $60 per barrel. In addition, the EU will ban imports of Russian petroleum refined products in February 2023.