The G7 Foreign Ministers (Great Britain, Germany, Italy, Canada, France, Japan and the USA) are considering measures to reduce Russian dependence on civilian nuclear products and related products, as well as banning Russian oil transport services. In a joint G7 statement blame Russia uses energy exports as a weapon. They believe that the Russian Federation has ceased to be a reliable supplier of energy sources.
“We are determined to consider a range of approaches, including options for a comprehensive ban on all services that allow the worldwide transportation of Russian oil and petroleum products,” the statement said.
In the statement published on the UK government’s website, it is emphasized that as the volume of Russia’s energy resources in domestic markets decreases, the G7 countries will work on “solutions that will reduce Russia’s hydrocarbon revenues and provide stability in global energy markets”. and to minimize negative economic consequences, especially for low- and middle-income countries.”
An exception will be made for Russian oil purchased at or below the price agreed with international partners.
In addition, the G7 countries aim to reduce their dependence on civilian nuclear products and related products from Russia.
On July 27, US Republican Senator Marco Rubio introduced a bill that would sanction any legal entity that insures or registers tankers transporting oil or liquefied natural gas (LNG) from Russia to China. According to the politician, China is supporting the special operation in Ukraine by buying Russian oil. The bill was supported by Senators Rick Scott (Fla.) and Kevin Kramer (North Dakota).
oil embargo
The European Union imposed its first oil sanctions on Russia on February 24, in connection with the start of special operations initiated by Russia in Ukraine. They banned the supply of goods, equipment and technologies for oil refining. The US imposed sanctions on Russian companies Gazprom Neft, Transneft, and personal restrictions on Rosneft head Igor Sechin (the EU sanctioned him on February 28). In the next step, the USA announced the introduction of export controls on oil and gas equipment supplied to Russia for oil production.
Norway, Switzerland and other countries joined similar and subsequent restrictions at different times.
On March 8, US President Joe Biden announced that he had banned the supply of oil, gas and coal from Russia. At the same time, the UK refused to buy Russian energy sources, including oil, until the end of the year (then it was decided to find alternative energy sources by the end of 2022 in order to completely abandon Russian oil). On March 11, Canada joined the sanctions. On March 15, the European Commission imposed sanctions on Rosneft, Transneft and Gazprom Neft. On April 6, the UK banned the export of equipment for oil production and refining, including catalysts. On April 9, the United States banned the import of energy products from Russia, including oil.
On June 3, in the sixth package of sanctions, the EU imposed a partial embargo on Russian oil – within 6 months, the EU intends to abandon the import of Russian oil to the import of petroleum products within 8 months. It includes an embargo on the supply of oil and petroleum products from Russia by sea.
At the same time, the ban on the supply of crude oil was postponed for six months for petroleum products – eight months from the moment of sanctions. The partial embargo includes temporary exemptions for Hungary, Slovakia, Bulgaria and Croatia. Thus, the export of Russian oil through the pipeline was removed from the sanctions and a number of benefits for the offshore supply were achieved for individual countries. In addition, Brussels lifted the ban on the transportation of oil from Russia by tankers under the flags of EU countries. On June 8, Canada refused to serve Russia in oil transportation.
“We will not work at your detriment”
In June, it became known that the G7 countries are planning to impose a “ceiling” on Russian oil prices. A ban on oil supply by sea is also discussed if its cost exceeds the ceiling “agreed upon by international partners”. It was known that at the end of July there was a “ceiling”. planned Enter by December 5, 2022
At the same time, the G7 plans to take these measures at a global level, and there is little agreement between the EU and the US for this. Therefore, negotiations with other countries are currently underway.
US Treasury Secretary Janet Yellen held “encouraging” talks with her Indian counterpart on July 18, Reuters reported. According to the agency, India disagreed, but allegedly did not express “disliking the idea”. Shortly before that, Yellen had “productive talks” with third countries on the sidelines of the G20 summit in Indonesia.
On July 20, Deputy Prime Minister of the Russian Federation Alexander Novak said that if the West sets a “ceiling” for oil prices and Russia is unable to cover the cost of extracting fuel, Moscow will stop energy supplies to those who comply with such restrictions. . According to Novak, the “ceiling” could lead to market instability, scarcity of energy resources and higher prices.
“If they talk about these prices [страны G7]It will be lower than the cost of oil production, of course, Russia will not be able to supply this oil to world markets, which means that we will not work at our expense.
Yellen is convinced that price caps are “one of the most powerful ways to tackle the problem of high prices facing people in America and around the world.” He believes that such a measure will reduce not only Russia’s income, but also energy costs. According to him, Western countries want to set maximum fuel prices at such a level that Russia can easily continue to extract and sell its energy resources.
Western countries came to this decision after the European Union placed an embargo on the purchase of Russian pipeline oil, which caused fuel prices to skyrocket. Russia diverted its resources to other markets, primarily India and China. Even the Russian Federation was left in the dark: Moscow sold smaller volumes of oil at a discount.