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Price cap on Russian oil fraught with devastating consequences — Foreign Ministry

The G7 finance ministers have stated their intention to impose a price cap on Russian oil

MOSCOW, November 30. /TASS/. The introduction of a mechanism to limit prices for Russian oil could greatly complicate the situation on global markets and would have devastating consequences for everyone, official representative of the Russian Foreign Ministry Maria Zakharova said on Wednesday.

"We have repeatedly said that such measures - the so-called cap on Russian oil prices - are not just a non-market mechanism, this is an anti-market measure that destroys supply chains and can significantly complicate the situation on global energy markets," she said.

"Russia will not supply oil to countries that back this anti-Russian confrontational initiative. It is anti-Russian, but the repercussions will be disastrous for everyone," she added.

The differences among EU members over this price cap, according to Zakharova, indicate "the isolation of this initiative from economic realities." "Price dictatorship, the development of a certain buyer cartel creates an exceedingly dangerous precedent for international trade, which is still based on market principles. Gradually, Europe and EU countries are beginning to realize what the United States is doing to them," she added.

Russian Deputy Prime Minister Alexander Novak said earlier that Russia will not supply oil to countries under the terms of the price cap, even if it would be more profitable. "This is generally unacceptable from the point of view of concluding contracts. We will work according to the market [conditions],"he said. Novak stressed that Russia does not plan to soften its position on this issue.

The G7 finance ministers have stated their intention to impose a price cap on Russian oil. They intend to accomplish this by forming a "wide international coalition" and prohibiting the provision of any services for the maritime transportation of Russian oil if it is sold at a price greater than the limit agreed upon the coalition. This ruling is likely to go into effect on December 5. Last week, the European Commission recommended capping Russian oil prices at $65-70 per barrel, which Poland and the Baltic countries opposed. Greece, Cyprus, and Malta, all of which rely on tanker traffic, want a bigger cap or some type of compensation.

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