The new turn of the screw in the sanctions against Russia for the invasion of Ukraine is already beginning to take shape. The G-7 countries have agreed this Friday to impose a cap on the price of Russian oil “to reduce Russia’s income and ability to finance the war.” Hence, they have promised to work so that this cap is ready “urgently”. While the finance ministers of the largest Western economies plus Japan reached this agreement, the president of the European Commission, Ursula von der Leyen, went a step further by declaring herself in favor of including gas: “I firmly believe that it is time to limit the price of gas from the Russian gas pipeline to Europe”.
The return to the European political and geostrategic course began in Prague this week with the agreement to launch a military training mission for the Ukrainian army and the restriction of visas for Russian citizens. And it has continued this Friday with a great leap forward, when the ministers of the G-7 and the head of Economy of the European Commission, have decided to impose a cap on Russian oil and urgently get to work to achieve it. They also call other countries to join their plans. “We invite other states to introduce the limit that is designed and implement this important measure,” says the final statement of the meeting held in Germany.
“Today, the G-7 has taken a critical step toward achieving our dual goals of pushing down global energy prices and denying Putin revenue to finance his brutal war in Ukraine. By committing to finalizing and implementing a price cap, the G7 will significantly reduce Russia’s main source of funding for its illegal war, while maintaining supplies to world energy markets by keeping Russian oil flowing at lower prices.” affirmed the US Secretary of the Treasury, Janet L. Yellen.
The maximum price has the support of Brussels, although it does not require its explicit support. Still, he had it. The president of the European Commission, Ursula von der Leyen, supported the measure and urged to adopt measures for some benefits that fell from the sky. “A gas limit can be proposed at a European level”, recalled the head of the Community Executive. This measure, however, will require the approval of the EU partners.
According to Reutersthe G-7 finance ministers will also put on the table mechanisms to mitigate the blow that Putin’s gas restrictions may have and ensure that they maintain access to energy markets.
Energy prices, especially gas, have skyrocketed due to the war in Ukraine and Putin’s control of the tap. Futures have eased after breaking through the €1,000 per megawatt hour (MWh) barrier in some countries such as France. This Friday, electricity prices are 422 euros per MWh in Germany; 524.3 euros in Italy and 516.7 in France. In Spain, according to the Ministry of Ecological Transition, they are 152.1 euros, which rises to 375.81 with compensation.
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