G7 price cap on Russian oil goes into effect

On Monday, a Russian oil delivered by sea price cap, imposed by the G7 countries, came into effect. Nevertheless, Russia said it would not adhere to the restriction even if it had to cut production.

The price ceiling imposed by the G7, Australia and the European Union is in addition to the EU embargo on Russian oil imports by sea and similar measures taken by the United States, Canada, Japan and Britain, Reuters reported.

Russia, the world's second-largest oil exporter, said Sunday that it does not intend to accept the restrictions and will not sell the oil they apply to, even if it has to cut production.

The cap price is set at $60 a barrel, not far below where it closed Friday at $67. Given that fact, the EU and G7 countries expect that Russia would still be interested in continuing to sell oil at that price, while making less profit.

The oil price restriction will be followed by a similar measure for Russian oil products, which will take effect on February 5, even though the level of the restriction has not yet been determined.