US, Allies Considering Price Cap on Russian Oil to Hurt Putin

  • Treasury Secretary Janet Yellen said the United States and its allies were discussing a price cap on Russian oil.
  • One of the goals is to “lower the price of Russian oil and lower Putin’s income”, she said on Monday.
  • A cap would also boost global market oil supply, Yellen said.

The United States and its allies are actively discussing a price cap on Russian oil, Treasury Secretary Janet Yellen said Monday.

She told reporters in Toronto that one of the purposes of a cap would be to “lower the price of Russian oil and reduce Putin’s income.”

Another goal would be to “enable more oil supplies to reach the global market,” she said at a joint news conference with Canada’s Finance Minister Chrystia Freeland.

Oil prices have skyrocketed since Russia invaded Ukraine, which has helped push the price of gas past $5 a gallon. Russia is the world’s largest exporter of natural gas and one of the top oil exporters, and is using revenues from those exports to help fund its war in Ukraine.

Yellen said a cap on Russian oil prices would be “an important way to prevent ripple effects on low-income and developing countries that are struggling with high food and energy costs. “.

She did not provide a timetable for the price cap, but said the United States was “actively working” with partners to impose one before the G7 leaders’ summit in Germany next week.

Freeland said Canada favored a price cap, but acknowledged “it’s a more difficult situation for the Europeans.”

The European Union is heavily dependent on Russian oil and gas. Russia supplied about 40% of the bloc’s natural gas in 2021, according to EU data. Europe is also a major buyer of Russian oil and was responsible for half of Russia’s crude oil exports in 2021, Insider previously reported.

Insider also reported earlier this month that Russian oil and gas sales could reach $285 billion this year, a 20% increase from 2021, amid soaring prices.

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