The Group of Seven (G7) is considering increasing the cap on Russian oil prices as part of efforts to reduce Moscow’s oil revenue amid the ongoing war in Ukraine, Bloomberg reports. A draft statement reviewed by Bloomberg suggests that G7 countries may ask their finance ministers to adjust the current price limit, which is set at $60 per barrel for Russian crude.
In December, the Biden administration tightened sanctions on Russian oil, impacting key players in the industry. According to Bharat Petroleum’s CFO, middlemen who supply Russian oil have stopped offering cargoes following new U.S. sanctions targeting Russian producers, tankers, and insurers. The sanctions specifically targeted Russian oil firms Surgutneftgas and Gazprom Neft, which together handle about 25% of Russian oil exports. In 2024, these companies shipped an average of 970,000 barrels per day.
Bharat Petroleum and other Indian state refiners purchase Russian oil through the spot market, mostly from traders. Vetsa Ramakrishna Gupta, CFO of Bharat Petroleum, stated, “We have not received any new offers for the March delivery window. Traders are asking us to wait, and we are waiting for new offers.”
Gupta also mentioned that India is not expecting to receive the same volume of oil cargoes it had in December and January.
Earlier, India confirmed it would comply with the sanctions and avoid accepting shipments from sanctioned tankers. The sanctions have had a noticeable effect on Russian oil exports to India and China, the two largest buyers of Russian crude. The sanctions have also raised the potential for increased leverage in future negotiations aimed at ending the war in Ukraine.
Last year, India briefly surpassed China as the largest buyer of Russian crude, but in November, India’s imports of Russian oil fell sharply by 55% year-on-year, reaching their lowest level since June 2022. This decline may reflect India’s efforts to diversify its oil sources to reduce dependence on a single supplier.
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