US Treasury Officials Urge for Continuation of Russian Oil Price Cap During Visit to India

GG News Bureau
New Delhi, 4th April. Two senior US treasury officials are currently in India to urge New Delhi to uphold the oil price cap that aims to limit profits to Russia and ensure stable global energy markets, according to an official announcement.

Acting Assistant Secretary for Terrorist Financing Anna Morris and PDO Assistant Secretary for Economic Policy Eric Van Nostrand are visiting New Delhi and Mumbai from April 2-5 to engage with government and private sector representatives, the Treasury stated on Wednesday.

During their visit, they will address important bilateral matters, such as collaboration on anti-money laundering, combating the financing of terrorism, addressing illicit finance issues, and continuing the enforcement of the price cap. The goal is to restrict Russia’s profits used to fund its illegal invasion while also promoting stability in global energy markets.

After Russia’s invasion of Ukraine in February 2022, the G7 nations, the European Union, and Australia jointly implemented a price cap. This cap prevents the use of Western maritime services, including insurance, flagging, and transportation, for tankers carrying Russian oil priced at or above USD 60 per barrel.

In 2023, Russia became India’s top oil supplier. Despite strong economic and defense ties with Russia, India has refrained from criticizing Moscow for its actions in Ukraine.

Morris and Nostrand will speak about the price cap and take part in a Q&A session organized by the Ananta Aspen Centre in New Delhi on Thursday.

As highlighted in a blog post by Morris and Nostrand last month, the second phase of the price cap continues to meet its objectives: limiting Russia’s oil profits and supporting energy market stability, the statement mentioned.

The price of Russian oil has dropped significantly since the start of the second phase, reflecting the impact of lower global oil prices during this period and a notable increase in the discount Russia receives compared to other global oil suppliers, the statement added.

Various energy market participants, analysts, and even Russian President Vladimir Putin’s oil czar have connected the growing discount on Russian oil to the Coalition’s enhanced enforcement activities under the second phase of the price cap – a clear indication that this phase is effective, the statement emphasized.

The price cap is ensuring a consistent energy supply for global consumers and businesses, giving key importers like India more bargaining power. Simultaneously, the price cap, along with crucial sanctions enforcement measures, is reducing Putin’s profits from oil sales, the statement concluded.