Russia continues to lose revenue due to Western sanctions.
The United States is confident that the G7 cap on Russian oil prices is helping to reduce Moscow’s revenues and stabilize energy markets. And this, despite the recent rise in prices.
This was stated by Acting Assistant Secretary of State for Economic Policy Eric Van Nostrand, reports Reuters.
Details
Nostrand said the price cap is a successful part of the multilateral sanctions regime imposed on Russia over its invasion of Ukraine. He added that Washington and its partners are working to prevent any evasion.
“Our approach has dealt a blow to the Kremlin’s most important cash cow. Before the war, oil revenues accounted for about a third of the entire Russian budget, but in 2023 this figure has dropped to 25%,” said Eric Van Nostrand.
Federal government oil revenues in the first half of 2023 were nearly 50% lower than a year earlier, according to Russian data, and Russian oil is trading at a significant discount to Brent crude.
In addition, Russian officials have also complained about the impact of the price cap, and the Kremlin has been forced to consider raising taxes on oil exporters to boost revenues, which could hurt the long-term outlook for its oil industry.
Recall that the European Union and “Bolshaya Semka” introduced a “ceiling” of oil prices at $60 per barrel. Thus, the fleet of the G7, the European Union and Australia, which also joined the agreement, will not transport or perform any other operations with Russian oil sold at a higher price.
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2023-08-03 18:17:00
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