By Enyichukwu Enemanna
Group of Seven industrial powers comprising the US, Germany, France, Britain, Italy, Canada and Japan have continued in their quest to recruit more countries who will join the feasibility of measures to bar imports of Russian oil within a certain price level.
According to US and European officials, the buy-in of more countries is needed before more detailed discussions about the policy’s specifics of the sanction.
The countries aim to restrict the amount of revenue the Kremlin receives to weaken its power in prosecuting its war against Ukraine, even as they want Russian oil on the market to avoid supply disruptions.
A senior White House official said the Biden administration expects the price cap to go into effect by the end of the year.
“The coalition has to be broader, and this is the diplomatic phase [negotiators] are entering into,” said one European official on Friday, requesting anonymity to discuss sensitive deliberations.
The world’s major democracies have banned the import of Russian oil. They are now negotiating a ban on insuring and shipping Russian oil to other countries, unless the sale is below a set price.
Key importers of Russian oil, China, India, and Turkey have not taken positions on whether they will join in the coordinated price cap or negotiate their own side deals with Russia. Their participation could determine how much leverage G-7 nations have to set prices.
“It’s premature to start discussing the price before the coalition comes together,” a senior Treasury Official says.
Foreign leaders are expected to have several gatherings over the next two months – at the UN General Assembly in New York, meetings of the International Monetary Fund and World Bank in Washington, and multilateral summits overseas to discuss the mechanism.
Negotiators expect that the Group of 20 nations or, 19 without Russia will have made a decision by the time they gather in Bali, Indonesia in mid-November.
“It will be the expectation that the G-20 countries will have been able, by that time, to communicate their possible participation,” the European official said. Until then, no discussions of the specific price under which to allow sale of Russian crude oil, high-value refined products and low-value refined products have taken place among allies.
“We have notions of what figures can be, but it’s just figures without a strong technical ground,” the European official said.
G-7 negotiators formalized their intention to pursue the price cap, after announcing it at the conclusion of the recent Alpine summit. Treasury Secretary Janet Yellen suggested that the U.S. doesn’t necessarily need China or Russia to participate for the policy to have its intended effect.
“We’re already seeing this initiative pay off because countries that are buying Russian oil at greatly discounted prices,” Yellen said on MSNBC after meeting with G-7 negotiators on Sept. 2. “We’re having an impact.”
