Dhe finance ministers of the G7 want to push through a price cap on Russian oil. In the final document on the deliberations of the G-7 finance ministers on Friday, however, no exact amount is given, nor is there a timetable. The measure is intended to limit Russia’s revenues after the attack on Ukraine, but at the same time to keep oil flowing to western countries.
There is a common political will to finalize and introduce such an instrument, according to the G-7 declaration, which the Federal Ministry of Finance disseminated. The aim is to implement it within the time frame of the sixth EU sanctions package, it said. The G7 – consisting of Germany, France, Italy, Great Britain, the USA, Canada and Japan – only want to allow services related to Russian oil deliveries if a certain price level for the oil is not exceeded. Ship insurance plays an important role here.
However, even G-7 representatives concede that ideally, important oil buyers such as China and India should be on board. However, this is not considered overly likely. The G-7 statement states that the aim is for a “broad coalition of countries” to join the effort. Individual states are not named. The measure could help poorer countries in particular, which are suffering particularly badly from the sharp rise in energy costs since the outbreak of war.
Chancellor Olaf Scholz (SPD) recently emphasized that a price cap only works if it is organized globally. Von der Leyen also said on Thursday in the ZDF program “mabrit illner” that “a large number of countries internationally” is necessary. “It now seems to be becoming apparent that we will achieve this goal.” When asked if China was on board, she said, “Not everyone is on board.”
Russia threatens to stop deliveries if gas prices are capped
Meanwhile, Russia’s former President Dmitry Medvedev threatened to cut off gas supplies to Europe if the EU imposed a price cap on Russian gas. “There will simply be no Russian gas in Europe,” writes the deputy chief of the Russian Security Council in the messaging app Telegram. He is reacting to statements by EU Commission chief Ursula von der Leyen. CSU in Murnau, Bavaria, said: “I am firmly convinced that it is now time for a price cap on Russian pipeline gas to Europe.”
The EU Commission had previously advised against a price cap on the wholesale market within the EU as an emergency measure in a draft, as this could distort supply and demand. Von der Leyen, on the other hand, is calling for a cap on gas import prices via pipelines from Russia. This could also lead to lower prices in the EU. However, there is a risk that Russia will no longer supply gas at the lower price.
Von der Leyen emphasized that the top priority is saving energy. “There is not enough energy globally. Putin would rather burn off the gas than deliver it to Europe or other regions as per the contract. So: save energy, and save wisely, especially at peak times, so that we don’t need gas then,” she said.
Secondly, one must ensure “that we can reinvest the excessive profits that the electricity producers have today, which they never expected and which they also cannot reinvest so quickly that we skim off some of them”. This was intended to support low-income and vulnerable companies in a targeted manner during the crisis. “The skimming of profits as an emergency tool in the short term in times of crisis, there is also a legal basis for this at European level,” she said. In an internal discussion paper available to the FAZ, there is talk of skimming off profits, especially for operators of nuclear power plants, wind energy and solar parks. As a third short-term point, the President of the Commission named the demand for a price cap on Russian pipeline gas.
Kremlin: Further “maintenance work” on Nord Stream 1 possible
Meanwhile, the Kremlin has also announced another disruption to gas supplies through Nord Stream 1. There are no technical reserves, Kremlin spokesman Dmitry Peskov said on Friday in Moscow, according to the Interfax news agency. “Only one turbine is running.” The energy giant Gazprom is not to blame for the fact that the reliability of the line through the Baltic Sea is endangered.
Earlier, Peskov claimed that Gazprom could meet its commitments, but that Europe imposed “legal and technical obstacles” on the company over sanctions related to the Ukraine war. He spoke of a crisis scenario. Gazprom stopped the flow of gas for three days, citing maintenance work at a compressor station. The federal government considers this to be a pretext. Gas is scheduled to flow again from Saturday morning. According to the Russian state-owned company, the last remaining turbine in the compressor station has to be serviced every 1000 working hours. The next stop should therefore be in mid-October.
