Russia Bans Oil Sales to Countries With Price Caps

Russia is banning oil exports to countries agreeing to Western price caps, Russian President Vladimir Putin announced yesterday.

• The Group of 7 economic bloc—composed of the United States, the United Kingdom, Canada, France, Germany, Italy and Japan—agreed earlier this month to cap the price of Russian oil to $60 per barrel.
• The other member states of the European Union and Australia are also on board with the cap.
• Many of these countries have already weaned themselves off of energy dependence on Russia.

Putin announced the new measure through decree, which will be enforced starting February 1.

Unanimity? The countries currently capping Russian oil make up much of the developed world. But major economies like China, India and Turkey have refused to sign up to the price cap. Countries within the EU, like Hungary, have also been advocating for exemptions to sanctions on Russia. And the price cap isn’t much lower than what Russia is selling its oil for anyway. When push comes to shove, the new ban will probably cause more countries to side with Russia.

Learn more: Read “Russia Doesn’t Need Our Business.”