G7 not capable of regulating Russian oil price

Washington/Moscow: The World Bank claimed that the G7 countries alone are incapable of capping the prices of Russian oil and that participation from more countries would be needed. The World Bank report argues that such a mechanism to control oil prices is unprecedented and poses a significant risk. Against the backdrop of the World Bank report, Norway, a major oil producer in Europe, has opposed the proposal to cap the price of Russian oil. The Norwegian Ministry of Petroleum and Energy has warned that this would further escalate the energy crisis in Europe.

Since the Russia-Ukraine war began, western countries imposed extensive sanctions against Russia, targeting oil exports. The Russian oil sector was targeted as well. But despite the sanctions, Russian oil exports and revenues remain unaffected. Therefore, the G7, a group comprising advanced countries of the world, has passed a resolution to impose a cap on Russian oil prices. However, it has yet to come into effect. Even though the European Union supported the resolution, the bloc has not approved the proposal.

In this scenario, questions raised on decisions of the G7 by a leading financial institution such as the World Bank become noteworthy. The World Bank claimed in its report that the G7 alone could not receive success in imposing the price cap and warned that support and participation of emerging economies would be necessary to make it a success. Following the report of the World Bank, Norway has opposed the proposal to cap the price of Russian oil as it would further affect the supply and intensify the prevailing energy crises in Europe.

Meanwhile, an acute shortage of diesel is being felt in many cities in the United States, and the media have reported that its stockpile will last only 25 days.