The new measures by the Group of Seven (G7) countries to limit Russian oil sales by imposing a price ceiling will not be applied against OPEC producers, which adopted plans to cut production, leaving consumer countries apprehensive, he told Reuters a US Treasury official.
The United States has contacted representatives of the Organization of Petroleum Exporting Countries (OPEC) to reassure them about the limits of the plans, the official added. The comments could help defuse a dispute between the United States and Saudi Arabia, the biggest oil exporter and de facto leader of OPEC, over what Washington sees as a collaboration with Russia to deprive markets of supply, at a time when that a global recession is in sight. OPEC+, which groups the cartel of producers and allies such as Russia, last week announced a production cut of two million barrels per day (bpd) to balance markets and contain volatility.
The December 5 price ceiling is designed specifically to deal with the Russian military operation in Ukraine and will not apply to other producers, the official added, as measures to control production raise prices. The new sanctions also do not signal the start of a cartel of buyers to counter the impact of OPEC’s policies on the oil market, said the official, who declined to be named due to the sensitivity of the situation. The Paris-based group of consumer countries at the International Energy Agency, including the United States, said last week that the OPEC+ cut has pushed prices up and could send the global economy into recession. Agreed by the G7 countries in September, the price ceiling plan clashed with much stricter European Union (EU) bans on Russian shipments ratified in June.
