“We are talking about price caps or a price exception that would enhance and strengthen recent and proposed energy restrictions by Europe, the United States, the UK and others, that would push down the price of Russian oil and depress Putin’s revenues while allowing more oil supply to reach the global market,” Yellen told reporters in Toronto.
“We think a price exception is also an important way to prevent spillover effects to low income and developing countries that are struggling with high costs food and energy,” Yellen said, speaking alongside Canadian Finance Minister Chrystia Freeland.
Yellen said a price exception is an effective cap that could be achieved through a mechanism to restrict or ban insurance or financing for Russian oil shipments above a certain amount.
The United States, Canada, Britain, and some other countries have banned imports of Russian oil, but the European Union remains highly dependent on Russian crude.
Asked if U.S. President Joe Biden planned to seek consensus on an oil price plan at the Group of Seven (G-7) leaders summit in Germany next week, Yellen said: “We are very active, actively working on this with our partners.”
Freeland said Canada “thinks it is a really good idea” to try to limit Russia’s oil revenues, but recognizes that this will be challenging for European countries.
“The path forward here is really to be talking with our European partners and to recognize, you know, how central they are in the decision making here,” Freeland said, adding that Ukraine needed to be included in any decisions as well.
By David Lawder