Russia says it will not accept caps on oil prices and is preparing to retaliate

(Reuters) – The Kremlin said in comments published on Saturday that Russia “will not accept” a cap on its oil prices and that it was considering how to respond, in response to an agreement between Western powers aimed at curbing a key source of financing. for its war in Ukraine.

Russia’s official Tass news agency quoted Kremlin spokesman Dmitry Peskov as saying that Moscow had made preparations for the G7, EU and Australia declaration on Friday.

“We will not accept this ceiling,” RIA news agency quoted him as saying. He added that Russia will conduct a quick analysis of the agreement and will respond after that, the RIA news agency reported.

Russia has repeatedly said it will not supply countries that apply the oil cap – a position confirmed by Mikhail Ulyanov, Moscow’s ambassador to international organizations in Vienna, in posts on social media on Saturday.

“Starting this year, Europe will live without Russian oil,” he said.

The G7 price cap would allow non-EU countries to continue importing seaborne Russian crude, but would bar shipping, insurance and reinsurance companies from handling shipments of Russian crude around the world, unless they are sold for less than $60. This could complicate shipping of Russian crude priced above the cap, even to countries not part of the agreement.

Russia’s Urals crude was trading at about $67 a barrel on Friday.

US Treasury Secretary Janet Yellen said the cap would particularly benefit low- and middle-income countries that have borne the brunt of higher energy and food prices.

“With Russia’s economy already shrinking and its budget growing ever thinner, the price cap will immediately be cut off from (President Vladimir) Putin’s most important source of income,” Yellen said in a statement.

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The Russian embassy in the United States, in remarks posted on Telegram, criticized what it called the “dangerous” Western move and said Moscow would continue to search for buyers for its oil.

“Such steps will inevitably lead to increased uncertainty and higher costs for consumers of raw materials,” she added.

“Regardless of the current flirtation with the dangerous and illegal instrument, we are confident that Russian oil will continue to be in demand.”

Written by Mark Trevelyan. Edited by Frank Jack Daniel

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