‘US has not asked India to cut Russian oil purchases’
The US has not asked India to cut Russian oil imports as the goal of sanctions and the G7imposed $60 per barrel price cap is to have stable global oil supplies while hitting Moscow’s revenue, an American treasury official said on Thursday.
India has emerged as one of the top buyers of Russian seaborne oil since western nations imposed sanctions and halted purchases in response to Moscow’s invasion of Ukraine in February 2022. “It is important to us to keep the oil supply on the market. But what we want to do is limit Putin’s profit from it,” Eric Van Nostrand, the US Treasury’s assistant secretary for economic policy said in New Delhi, referring to Russian President Vladimir Putin. Nostrand said that buyers can purchase Russian oil at deeper discounts outside of the price cap mechanism, if they do not use Western services like insurance and broking, thus limiting Moscow’s sales avenues.
PRICE CAP
“They (Russia) have to sell oil for less,” he said. The sanctions are intended to limit the options available to Russia to sell its oil under the price cap, offer deeper discounts to buyers if they circumvent Western services or shut its oil wells, Nostrand added.
The price cap imposed by the Group of Seven (G7) nations, the European Union and Australia bans the use of Western maritime services such as insurance, flagging the transportation when tankers carry Russian oil priced at or above $60 a barrel. Anna Morris, acting assistant secretary for terror financing at the US Treasury said that G7 nations had the option to review the price cap depending on market conditions or other factors.
The US, in February, imposed sanctions on Russian staterun shipper Sovcomflot and 14 of its crude oil tankers involved in Russian oil transportation.