Jun 13, 2025
Most G7 countries are prepared to reduce the price cap on Russian oil without the involvement of the US.
Most G7 countries are willing to proceed independently and reduce the price cap on Russian oil, even if U.S. President Donald Trump decides not to participate, according to four sources familiar with the situation.
G7 leaders are scheduled to meet from June 15-17 in Canada to discuss the price cap initially agreed upon in late 2022, which allows Russian oil sales to third countries using Western insurance, provided the price does not exceed $60 per barrel.
The EU and Britain have been advocating for a lower price cap for weeks, as a decline in global oil prices has rendered the current $60 cap almost ineffective. The cap aims to limit Russia's ability to finance the conflict in Ukraine.
The unnamed sources indicated that the EU and Britain are prepared to take the lead, supported by other European G7 nations and Canada.
It remains uncertain what the U.S. will decide, although Europeans are advocating for a unified decision at the meeting, with Japan's stance also unclear.
"There is a movement among European countries to reduce the cap from $60 to $45. Positive signs are coming from Canada, Britain, and possibly Japan. We will aim to persuade the U.S. during the G7," one source stated.
When asked about Trump's stance on the Russian oil price cap, a White House official mentioned that the president anticipates a "robust discussion on key economic and geopolitical issues."
At last month's G7 finance ministers meeting, U.S. Treasury Secretary Scott Bessent reportedly remained unconvinced about the necessity of lowering the cap, according to sources.
However, some U.S. Senators, including Lindsay Graham, have expressed support for reducing the cap and are advocating for new sanctions against Russia that could impose high tariffs on Russian oil buyers.
The Canadian foreign ministry did not respond immediately for comment.
The EU has proposed lowering the cap to $45 per barrel in its latest sanctions package, which requires unanimous approval from member states, a process that may take several weeks.
Russia's main export grade, Urals, is trading at about a $10 discount to the Dated Brent benchmark from Baltic ports, with Brent futures priced below $70 since early April.
Sources noted that the U.S. buy-in is not critical for lowering the cap due to Britain's dominance in global shipping insurance and the EU's influence over the compliant tanker fleet.
Nevertheless, the U.S. plays a significant role concerning dollar-denominated oil payments and its banking system.
The EU and its Western allies have been increasingly targeting Russia's shadow tanker fleet and related entities attempting to bypass the cap.
This pressure has begun to impact Moscow's revenues, and Western allies hope to redirect more oil trade back under the cap. Rosneft, Russia's state-owned oil producer, reported a 14.4% drop in profits last year.
G7 leaders are scheduled to meet from June 15-17 in Canada to discuss the price cap initially agreed upon in late 2022, which allows Russian oil sales to third countries using Western insurance, provided the price does not exceed $60 per barrel.
The EU and Britain have been advocating for a lower price cap for weeks, as a decline in global oil prices has rendered the current $60 cap almost ineffective. The cap aims to limit Russia's ability to finance the conflict in Ukraine.
The unnamed sources indicated that the EU and Britain are prepared to take the lead, supported by other European G7 nations and Canada.
It remains uncertain what the U.S. will decide, although Europeans are advocating for a unified decision at the meeting, with Japan's stance also unclear.
"There is a movement among European countries to reduce the cap from $60 to $45. Positive signs are coming from Canada, Britain, and possibly Japan. We will aim to persuade the U.S. during the G7," one source stated.
When asked about Trump's stance on the Russian oil price cap, a White House official mentioned that the president anticipates a "robust discussion on key economic and geopolitical issues."
At last month's G7 finance ministers meeting, U.S. Treasury Secretary Scott Bessent reportedly remained unconvinced about the necessity of lowering the cap, according to sources.
However, some U.S. Senators, including Lindsay Graham, have expressed support for reducing the cap and are advocating for new sanctions against Russia that could impose high tariffs on Russian oil buyers.
The Canadian foreign ministry did not respond immediately for comment.
The EU has proposed lowering the cap to $45 per barrel in its latest sanctions package, which requires unanimous approval from member states, a process that may take several weeks.
Russia's main export grade, Urals, is trading at about a $10 discount to the Dated Brent benchmark from Baltic ports, with Brent futures priced below $70 since early April.
Sources noted that the U.S. buy-in is not critical for lowering the cap due to Britain's dominance in global shipping insurance and the EU's influence over the compliant tanker fleet.
Nevertheless, the U.S. plays a significant role concerning dollar-denominated oil payments and its banking system.
The EU and its Western allies have been increasingly targeting Russia's shadow tanker fleet and related entities attempting to bypass the cap.
This pressure has begun to impact Moscow's revenues, and Western allies hope to redirect more oil trade back under the cap. Rosneft, Russia's state-owned oil producer, reported a 14.4% drop in profits last year.