Japan has agreed to coordinate with the United States in setting a price cap on Russian oil exports to pressure Moscow to halt its aggression against Ukraine, according to a Japanese official.
G-7 leaders from the United States, Canada, Germany, Italy, Japan, and the European Union (EU) said June 28 that they would explore imposing a cap on Russian oil prices to “prevent Russia from profiting from its war of aggression.”
Among options under consideration include “a possible comprehensive prohibition of all services” that are linked to the transportation of Russian seaborne crude oil and petroleum products globally.
This is “unless the oil is purchased at or below a price to be agreed in consultation with international partners,” according to the communique.
Russian Oil and Fuel Revenue Increase
The United States and the EU have sanctioned Russia and banned imports of Russian oil since its invasion of Ukraine in February. While these had led to a decline in Russian export volumes, Russian revenues increased last month because of higher crude oil and fuel prices.“With higher crude oil and product prices globally, Russian oil export revenues are estimated to have increased by $1.7 billion in May to about $20 billion,” the International Energy Agency stated in its June report.
Despite the bans, the EU remained the main destination for Russian exports last month, making up 43 percent of Russian flows, followed by just over a quarter to China.
“As for the timing of the reduction or stoppage of [Russian] oil imports, we will consider it while gauging the actual situation,” he told reporters.
Reuters contributed to this report.