G7 group of nations and its allies, including the us, uk, germany, france, canada, italy, japan and australia, have agreed to cap the price of russian oil at $60 (â£49) a barrel. this move was made in an attempt to put western pressure on russia over the invasion of ukraine. brent crude was up by more than 1% in morning trade in asia, indicating that the move would have an impact on the market.
the decision was made on thursday, with the g7 and australia releasing a joint statement saying the $60 cap on russian oil would be imposed soon. this comes as opec+ has agreed to keep to its policy to reduce production in response to slower global growth and higher interest rates. furthermore, the eu-wide ban on russian crude oil imported by sea will come into effect on monday.
traders are responding positively to the news, with us jobs data and the easing of covid restrictions in some chinese cities also playing a role. the escalating prices of oil and gas have caused unrest due to the concern that the russian invasion of ukraine could affect supply. janet yellen, us treasury secretary, proposed a price cap on russian crude oil exports, claiming it would limit the revenues used to fund president vladimir putin’s “brutal invasion” of ukraine. ukraine’s president volodymyr zelensky dismissed the cap as “weak” and not “serious” enough. russia has threatened to cease exporting oil to countries that implement the cap, and has already started to sell its crude oil to other markets, such as india and china, who are now the largest purchasers of russian crude oil.