G7 Countries Ponder A Cartel To Curb Russian Oil Prices
According to US Treasury Secretary Janet Yellen, the G7 finance ministers and central bank governors have yet to agree on how to curb Russian oil imports. She believes that a cartel should be formed to manage the oil prices. The US has suggested tariffs on Russian oil, and the EU is considering an embargo.
On the 19th and 20th of May, G7 representatives are assembling in Koenigswinter, Germany for a two-day summit. Mrs. Yellen stated during the first day of the meeting that there was « minimal discussion » about methods to restrict Russia’s revenues from oil supplies to Europe. She did, however, express enthusiasm for the concept. « No evident approach is emerging, » the minister told reporters (Reuters).
According to Janet Yellen, a price cap on Russian oil purchases could be implemented. The price ceiling could be imposed by a buyer’s cartel. « You’ll need a massive cartel for that; the EU might not be enough, » she stated.
The sanctions enacted in reaction to the military operation in Ukraine included rejection of Russian energy supply. Hungary rejected the EU’s sixth sanctions package, which was issued in early May and asked for a gradual phase-out of Russian oil. The new sanctions are still being worked up. Russia’s oil incomes have climbed by 50% since the beginning of the year, according to Bloomberg.