G7 Weighing Tightening Russian Oil Price Cap At War’s 3-Year Mark

The Group of Seven is looking to send a big anti-Russia message on Feb. 24, the three-year anniversary of Putin’s invasion of Ukraine, with a potential tightening of an oil price cap intended to further hurt revenue for Russia’s war machine.

Bloomberg has revealed a G7 draft statement Tuesday calling for member nations to collectively redraw the price limit, which is currently set at $60 a barrel for crude oil. The document spells out pressure for Russia to “incentivize it to negotiate a meaningful peace” in Ukraine; however, it’s anything but clear whether this is being called for in cooperation with Trump officials, who are engaged in direct talks with Moscow.

The draft at one point references “troops and resources on the ground, coupled with robust international oversight to monitor agreed-upon lines,” Bloomberg writes.

But based on the wording, it does seem a last-ditch parallel effort to jump-start a peace arrangement with Moscow, as European nations in particular seek a ‘seat at the table’ – given both Zelensky and EU officials were completely cut out of Tuesday’s meetings with Russian representatives in Saudi Arabia.

According to more of the content:

The draft indicates the allies would “recognize” Ukrainian President Volodymyr Zelenskiy’s “readiness to engage in talks to end the war,” while warning that Russian President Vladimir Putin’s terms for peace “have so far amounted to Ukraine’s complete capitulation.” The draft shows the allies are planning to meet with Zelenskiy on Feb. 24.

Allies will call, according to the draft, for a “common sense peace that is fair, a peace that lasts,” which would entail “a durable security guarantee.”

The initial oil price cap by the Western allies, first implemented in December 2022, proved too easy for Russia to work around, as India and China have remained the biggest buyers of Russian crude, and have proven not so compliant.

The outgoing Biden administration in December then sought to ratchet sanctions on Russian oil, including sanctions on Surgutneftgas and Gazprom Neft, two Russian oil firms which together account for 25% of exports. Middlemen who supply Russian oil have also been targeted.

This new planned G7 initiative would aim to severely disrupt Russian oil exports to India and China, and if successful could give Trump’s team more leverage in negotiations with Moscow. But Bloomberg also notes:

The allies will maintain their line that any negotiation to end the war “must involve Ukraine’s full participation,” and leave it open to pursuing Euro-Atlantic integration.

It’s hard to be sure what tightening or adapting the cap would look like in practice. While a lower price could be one option, another could be to try to bolster enforcement of the current measure.

The incoming Treasury Secretary, Scott Bessent, says he believes the Biden Administration’s sanctions on Russia were not aggressive enough, and he would support imposing harsher sanctions on Russian oil companies pic.twitter.com/8zw8QzlRBm

— Michael Tracey (@mtracey) January 16, 2025

During a late Tuesday afternoon press Q&A from Mar-a-Lago, Trump blasted critics of his peace plan, saying ”I hear they’re upset about not having a seat. Well, they’ve had a seat for three years.” This was in response to Ukrainians feeling ‘betrayed’ by being left out of current talks with Moscow.

Meanwhile, there are reports saying Trump and Putin could finally meet face-to-face by month’s end, as the sides potentially progress toward a firm deal.