G7 Weighs Further Tightening of Price Cap on Russian Crude
In a related international development, Bloomberg has reported that the Group of Seven (G7) is considering a collective move to tighten its oil price cap on Russian petroleum. Current proposals suggest that finance ministers may be tasked with redrawing the cap—presently set at $60 per barrel—as part of broader efforts to curb Moscow’s revenue streams amid the conflict in Ukraine.
This potential policy shift follows the Biden administration’s decision last December to impose tougher sanctions on Russian oil. The measures have already led to significant market disruptions, with middlemen halting cargo offers in the wake of sanctions targeting major Russian oil companies such as Surgutneftgas and Gazprom Neft, which together handle about 25% of Russia’s oil exports.
Bharat Petroleum CFO Vetsa Ramakrishna Gupta, speaking to Reuters, noted that Indian state refiners have observed a marked decline in cargo offers for the upcoming March delivery window. “We have not received any new offers for the March window. Traders are asking us to wait. We are waiting to get offers,” Gupta said, adding that the number of cargoes is notably lower than in previous months.
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India, one of the largest buyers of Russian crude, has confirmed that it will comply with the new sanctions, a decision that has already contributed to a significant drop in its imports of Russian oil. Last November, India’s Russian oil imports plunged by 55% year-on-year, as the country diversifies its energy sources to reduce reliance on any single supplier.
Sources: NNPC, Oilprice.com, Reuters, Bloomberg
