financetom
Business
financetom
/
Business
/
Russia says Ukraine's idea of $30 oil price cap "beyond all bounds"
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Russia says Ukraine's idea of $30 oil price cap "beyond all bounds"
Mar 21, 2024 5:32 AM

MOSCOW (Reuters) - Russia said on Thursday that the United States was unlikely to agree to a Ukrainian proposal to lower the price cap on Russian oil to $30 a barrel because it would roil global energy markets and damage the U.S. economy.

After Russia sent troops into Ukraine in 2022, the West sought to sink the Russian economy by imposing a myriad of sanctions and in 2022 slapped a $60 a barrel price cap on Russian oil, which is currently traded at around $68 per barrel.

Before the cap was set, Ukrainian President Volodymyr Zelenskiy in November 2022 urged a limit between $30 and $40 per barrel.

The $60 cap has so far been maintained despite fluctuations in the oil price and calls by some countries for a lower cap to further restrict Moscow's revenues.

The United States has imposed sanctions on dozens of tankers suspected of carrying oil above the price cap agreed by G7, the EU and Australia.

President Vladimir Putin says Russia's wartime economy -- which grew 3.6% last year -- has thrived despite the sanctions, and that Russia, the world's second largest oil exporter, has plenty of buyers for its oil.

"The other day I read that Ukraine was trying to convince the United States to lower the cap price on Russian oil to $30 a barrel," Russian Foreign Minister Sergei Lavrov said in an interview published on the Foreign Ministry website.

"This goes beyond all bounds."

"It is significant that the United States is unlikely to go along with Ukraine," Lavrov said. He argued that such a lowering of the cap would have a serious impact on both the global oil market and on the U.S. economy.

Russia has more than 5% of the world's proven oil reserves and about of quarter of the world's proven natural gas reserves while OPEC, led by Saudi Arabia, controls about 80% of the world's oil reserves, according to OPEC figures.

SAUDI ARABIA

Lavrov, Putin's foreign minister since 2004, said that the United States put immense pressure on the House of Saud in the 1980s to collapse the price of oil to weaken the Soviet Union.

Asked about relations with Saudi Arabia, whose crown prince, Mohammed bin Salman, congratulated Putin on his election on and who has cooperated closely with Moscow as part of the OPEC+ group, Lavrov said Saudi had pursued its own policy.

"I would not say that they have set a course away from the United States," Lavrov said.

"They simply decided to pursue their national policy so that no one (from the left or the right, or from above or from below) should interfere with them, including, most of all, the United States."

While Russia says it will never give in to the United States, which Putin casts as a declining empire fighting a proxy war with Russia in Ukraine, Russia's energy sector has faced serious challenges from the fallout of the war in Ukraine.

Russia's Gazprom has lost most of the European market - which Moscow spent about half a century slowly building after the Soviets forged gas pipelines westwards from Siberia in the early 1970s.

Putin's bid to reorient Russia's vast energy exports eastwards faces massive hurdles - both the vast distances to Asian markets and the difficult negotiations with China about the price.

"There will be no shortage of consumers. Take Africa - we have doubled the export of petroleum products there over the past year and a half," Lavrov said.

He said China and India would be able to absorb oil supply from the OPEC+ group of leading oil producers.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Cathie Wood's ARK Invest scoops up nearly 10,000 Reddit shares in debut
Cathie Wood's ARK Invest scoops up nearly 10,000 Reddit shares in debut
Mar 22, 2024
(Reuters) - Popular investor Cathie Wood's ARK Invest bought nearly 10,000 shares of Reddit ( RDDT ) in the social media platform's strong market debut on Thursday, an email from the asset manager showed. A total of 9,982 shares of the loss-making company was added to ARK Next Generation Internet ETF ( ARKW ) and ARK Fintech Innovation ETF (...
Hutchmed Begins Registration Stage for Phase 2/3 Trial of Investigational Autoimmune Disorder Drug
Hutchmed Begins Registration Stage for Phase 2/3 Trial of Investigational Autoimmune Disorder Drug
Mar 22, 2024
05:04 AM EDT, 03/22/2024 (MT Newswires) -- Hutchmed ( HCM ) said late Thursday it has started the registration stage for a phase 2/3 clinical trial of investigational drug sovleplenib for adult patients with warm antibody autoimmune hemolytic anemia in China. The move follows positive data from the proof-of-concept phase 2 stage of the trial and a consultation with the...
Japan's union group Rengo announces biggest wage hikes on record
Japan's union group Rengo announces biggest wage hikes on record
Mar 22, 2024
TOKYO (Reuters) -Japanese firms have agreed to raise pay by 5.25% this year, the biggest rise under comparable data since 2013, the country's largest union group Rengo confirmed on Friday. The results of the closely-watched wage negotiations are announced in several stages, in which the blue-chip firms are first to wrap up their talks in mid-March. The second announcement on...
Once a beacon of stability, Vietnam to name third president in a year
Once a beacon of stability, Vietnam to name third president in a year
Mar 22, 2024
HANOI, March 22 (Reuters) - Communist-ruled Vietnam is seeking its third president in little more than a year after the resignation of Vo Van Thuong, who was only elected last year after the sudden dismissal of his predecessor. With accumulated foreign direct investment higher than its gross domestic product, Vietnam's stability is crucial to multinationals with large operations in the...
Copyright 2023-2026 - www.financetom.com All Rights Reserved