G-7 hits snag over setting cap on Russia oil

Talks to finalize a cap on the price of Russian oil long in the works by the United States and proUkraine allies faced a setback Wednesday, as a meeting of senior European Union diplomats over the exact price and other details ended without agreement.

The plan is close to being finalized and must be in place before an E.U. embargo on Russian oil imports kicks in Dec. 5.

E.U. diplomats from all 27 member states met throughout the day and into the evening Wednesday to iron out the final details, including, crucially, at what price the cap should be set.

They were not able to reach agreement because their views on where exactly the price should be set were too far apart, and some countries asked for additional changes to the policy. It was not immediately clear when they would reconvene to pick up negotiations.

At stake is a complicated, fraught effort among Ukraine’s allies to limit the Kremlin’s revenues from oil exports while averting a shortage of the fuel, which would force prices up and compound a cost-of-living crisis around world.

The E.U. ambassadors representing the 27 nations that make up the bloc have been asked to set a price between $65 and $70 per barrel and to approve softtouch enforcement methods.

The bench mark for the price of Russian oil, known as the Urals blend, traded between $60 and $70 per barrel in the year before the pandemic. It rose as high as $100 per barrel shortly after Russia’s invasion of Ukraine in February but over the past three months has settled between $65 and $75 per barrel. This week, it has traded at the lower end of that range.

A senior Treasury official said Tuesday that the coalition was expected to announce the price in the coming days. The price is likely to change over time, the official said, based on regular reviews that take into account changing market conditions.

Russia has said it will not comply with a formal price cap.