G7 finance ministers agreed to finalizing the implementation of a price cap on Russian crude on Friday, while prohibiting the export of Russian-origin crude oil and petroleum products by maritime transport.
The transport of Russian sea-born crude “would only be allowed if the oil and petroleum products are purchased at or below a price cap,” G7 members announced in a joint statement.
The purpose of the price cap is to reduce Russian revenue and the country’s ability to fund the war, while limiting the impact of the war on global energy prices.
The group committed to urgently work on the finalization and implementation of the measure in their own jurisdictions. Among the 27 EU member states, unanimity is required for the measure to take effect.
“The initial price cap will be set at a level based on a range of technical inputs and will be decided by the full coalition in advance of implementation in each jurisdiction,” the G7 said.
Meanwhile, the group encouraged oil-producing countries to increase their output to decrease volatility in energy markets.
G7 members include Canada, France, Germany, Italy, Japan, the UK, US and the EU as a non-enumerated member, meaning it cannot assume rotating G7 presidency.