US Say Russia Should Supply Oil With G7 Price Cap Plan

Deputy US Treasury Secretary Wally Adeyemo on Friday said that Russia will have to participate at some level in the G7 proposed oil price-cap otherwise they will risk damaging future oil-production capacity. The US aims to implement their price cap on Dec 5 in line with the start of the EU ban on Russian seaborne crude.

• “Russia may bluster and say they won’t sell below the capped price, but the economics of holding back oil just don’t make sense,” said Adeyemo.
• “Russia doesn’t have much storage capacity for oil, and many of its wells and equipment are far from state of the art, which makes it hard for them to stop and later restart production without incurring significant costs.”
• The ceiling will be set “above Russia’s marginal cost of production, at a level consistent with prices they have historically accepted,” Adeyemo said.
• Putin has previously said that Russia will not supply crude oil, refined products or gas to any nations that introduce price caps.