G7 Price Cap on Russian Oil to Give Buyers "Leverage"

The G7 price cap on Russian oil will give buyers more leverage to get better prices according to US Treasury Official Ben Harris.

• The plan, agreed upon in principle last month but thin on details, is designed to keep Russian oil volumes flowing and avoid market tightness.
• The price of the cap – yet to be agreed - will be calculated on a dollar per barrel basis and will be set at a level that will retain an incentive for companies to produce according to Harris.
• "The intention of the price cap is to preserve trade of Russian oil but at lower prices," Harris said.
• "Because we want to provide economic incentives for Russia to continue to produce, we're considering the higher cost wells as a data point." he added.
• "We can have a very successful price cap without a single barrel traded under the price cap. If what we've done is provide leverage for those importers to get the best discount possible, we're perfectly fine with that." he said.