US still finds unrestricted Russian oil trade unacceptable

The US has reiterated its stance on the Russian oil trade, calling it “unacceptable” and emphasizing the importance of the western price cap on Moscow’s petroleum products. The price cap is aimed at forcing Russia to continue selling oil at lower prices than it could otherwise obtain, while also maintaining a stable energy supply to Europe and emerging markets.

US Assistant Secretary for Economic Policy Eric Van Nostrand highlighted the benefits of the price cap mechanism, stating that emerging markets like India have benefited from the discounted price of Russian oil. He emphasized that the price cap is designed to limit Putin’s oil profits and maintain stable global oil supply.

The G7 and its allies announced the price cap in December 2022 as part of punitive measures against Moscow for its invasion of Ukraine. The cap restricts countries from paying more than USD 60 a barrel for Russian oil.

Acting Assistant Secretary for Terrorist Financing Anna Morris pointed out that Russia has been building up an infrastructure of ships, insurers, and other maritime services with providers with opaque ownership structures in response to the price cap. She noted that the changing market conditions have resulted in a narrowing of the discount on Russian oil, prompting the US to expand its approach to enforcing the price cap regime.

The US officials are currently in India to discuss various dimensions of the global energy market, underscoring the importance of international cooperation in addressing the challenges posed by the Russian oil trade.