Fri, 03 Feb 2023

Zelenskyy: G7 Oil Price Cap a Half-Measure, Wont Stop Russia

Voice of America
04 Dec 2022, 16:07 GMT+10

Ukrainian President Volodymyr Zelenskyy said capping the price of Russian seaborne oil at $60 a barrel is not aggressive enough to squeeze the Russian economy that funds its invasion in Ukraine.

The price cap was agreed to by Australia, Britain, Canada, Japan, the United States, and the European Union, but the Ukrainian leader called Saturday for a much lower one.

"The logic is obvious," he said. "If the price limit for Russian oil is $60 instead of, for example, $30, which Poland and the Baltic countries talked about, then the Russian budget will receive about $100 billion a year."

"This money," he said, "will go not only to the war and not only to Russia's further sponsoring of other terrorist regimes and organizations. This money will also be used to further destabilize precisely those countries that are now trying to avoid big decisions."

The West believes such a significant reduction in price could undercut the cost of Russian oil production.

"We think the number at $60 a barrel is appropriate" to balance limiting Moscow's ability to profit and ensuring supply meets demand, said John Kirby, U.S. National Security Council coordinator for strategic communications, on Friday, adding that the cap can be adjusted.

FILE - Smoke billows from an oil refinery owned by Russian oil producer Gazprom Neft, in Moscow, Russia, Nov. 17, 2018. FILE - Smoke billows from an oil refinery owned by Russian oil producer Gazprom Neft, in Moscow, Russia, Nov. 17, 2018.

Russia Rejects $60-a-Barrel Cap on Its Oil, Warns of Cutoffs 

The cap proposed by U.S. Treasury Secretary Janet Yellen aims to reduce Russia's oil earnings, which support its military and the invasion of Ukraine.

The price cap takes effect on Monday, which coincides with the European Union's embargo on most Russian oil shipments. It's uncertain how all of this will affect oil markets, which are swinging between fears of lost Russian supply and weakening demand caused by the lagging global economy. Russia could retaliate by halting shipments, and Europe may struggle to replace imports of Russian diesel fuel.

For its part, Russia rejected the price cap and threatened to turn off the oil spigot on the coalition of Western countries that endorsed the cap.

'We will not accept this ceiling,' TASS quoted Kremlin spokesman Dmitry Peskov as saying on Saturday.

The Russian Embassy in Washington said Saturday it will continue to find buyers for its oil, despite what it called "dangerous" attempts by the West to introduce a price cap on its oil exports.

'Steps like these will inevitably result in increasing uncertainty and imposing higher costs for raw materials to consumers,' it said.

Shelling resumes

Russia has resumed shelling the southern Ukrainian city of Kherson. And officials warned of a tough winter as Russian strikes target energy infrastructure.

'Russian invaders shelled Kherson - damaged power grids. The city was left without electricity again,' Governor Yaroslav Yanushevych said on Telegram, adding that technicians were already working to restore power to the recently liberated city on the west bank of the Dnipro River.

Officials in Kherson have announced they will help citizens evacuate parts of Russian-occupied territory on the east bank of the Dnipro River amid concerns of intensified fighting in the area.

Since Russia's retreat from Kherson, Ukrainian forces could advance south through the fields of the Zaporizhzhia region to recapture occupied territory and repel the invaders, according to The Washington Post.

Their aim would be to control the land bridge that connects Russia to Crimea. Their counteroffensive must wait, though, until the cold sets in and the muddy ground freezes.

Meanwhile, the world should expect "the reduced tempo in fighting in Ukraine to continue in coming months," U.S. Director of National Intelligence Avril Haines said Saturday at the Reagan National Defense Forum in California, noting she sees no evidence of a reduced will to resist on the part of the Ukrainian forces.

Assessing Putin

In Kyiv on Saturday, Victoria Nuland, undersecretary of state for political affairs, said Russian President Vladimir Putin is not serious about peace talks with Ukraine at this time. She commented after meeting with President Zelenskyy and other senior Ukrainian officials.

'Whether it's the energy attacks, whether it's the rhetoric out of the Kremlin and the general attitude, Putin is not sincere or ready for that,' she said.

A local resident enters a shop in Bakhmut, Donetsk region, Dec. 2, 2022. A local resident enters a shop in Bakhmut, Donetsk region, Dec. 2, 2022.

Russia Investing Large Amount of Its Military Might in Ukraine's Bakhmut

Earlier Saturday, French President Emmanuel Macron said in an interview with French TV station TF1 that the West should consider how to address Russia's need for security guarantees if Putin agreed to negotiations about ending the war in Ukraine.

'This means that one of the essential points we must address - as President Putin has always said - is the fear that NATO comes right up to its doors, and the deployment of weapons that could threaten Russia,' Macron said.

The French president said Western nations need to prepare "how we protect our allies and member states, and how to give guarantees to Russia the day it returns to the negotiating table.'

Russia and the U.S. both have said this week they are open to talks in principle, though U.S. President Joe Biden said he would only talk to Putin if he showed genuine interest in ending the war.

Ukraine says negotiations are possible only if Russia stops attacking and pulls out its troops.

Some information in this report came from the Associated Press, Reuters and Agence France-Presse.

More Palestinian News

Access More

Sign up for Palestinian News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!