G7 finance ministers will meet on Friday (2nd) to discuss imposing a price cap on Russian oil, Russian Deputy Prime Minister Alexander Novak (Alexander Novak) responded on Thursday (1st), with regard to those who set up prices for Russian oil. For companies or countries with price caps, Russia will stop supplying crude oil and petroleum products.
China and India are still buying large quantities of Russian oil and are reluctant to join Western sanctions. The United States is actively pushing for a price cap for Russian oil to win support from Western allies and China, among others.
The European Union is planning to start banning imports of Russian oil and gas next year, and a price cap could help buy Europe time to reduce its dependence on Russian energy.
G7 finance ministers will meet on Friday, when plans for a cap on Russian oil prices may be finalized and implemented. U.S. Treasury Secretary Janet Yellen was optimistic on Wednesday that “substantial progress” is expected on the plan.
“Russia will not supply crude oil or petroleum products to companies or countries that impose this restriction, because we do not operate under non-market conditions,” Novak warned on Thursday.
He slammed the idea of the G7 setting a price cap for Rosneft as completely absurd, which would destabilize the entire industry.
Novak also said Russia’s oil production could increase this year despite Western sanctions on Ukraine, while supporting an extension to the OPEC+ deal to cut output until the end of 2022.
Russia is choking on the gas throat of European countries. Gazprom announced on Wednesday that it will stop the Nord Stream 1 pipeline to send natural gas to Germany from August 31 to September 3, citing maintenance reasons. This has revived fears in Europe that Russia may repeat the same trick and delay the date of resumption of supplies.
“These are technical issues, and Gazprom has said that the pipeline will be out of service for three days, and the Nord Stream 1 pipeline is expected to resume gas supply in the early hours of Saturday,” Novak said on Thursday.
Brent crude for November delivery fell 3.4% to settle at $92.36 a barrel on Thursday. Dutch TTF front-month natural gas prices fell 5.15% to 239.905 euros per MWh.