U.S. Treasury Seeking Simple Russian Oil Price Cap Compliance Regime -Adeyemo
The U.S. Treasury is seeking to design a simple compliance regime for enforcing a price cap on Russian oil exports and hopes that China and India join the coalition or at least take advantage of it, Deputy Treasury Secretary Wally Adeyemo said on Tuesday.
Adeyemo, speaking at a finance conference in New York, said the United States and its Western allies need financial services providers to help enforce the price cap aimed at shrinking revenues funding Russia's war in Ukraine while keeping Russian crude on the market to avoid price hikes.
The Group of Seven wealthy nations on Friday agreed to impose a price cap, which calls for participating countries to deny insurance, finance, brokering and other services to oil cargoes priced above the cap, which is yet to be set.
"In order for the price cap to be effective, we need service providers, especially those providing financial services, to help with implementation. We want to work with you to design a compliance regime that is as simple as possible and helps to accomplish our objectives," Adeyemo said in remarks to the Clearing House and Bank Policy Institute conference.
The G7 is made up of Britain, Canada, France, Germany, Italy, Japan and the United States. The European Union has pledged to begin a ban on Russian oil imports in December. Adeyemo said
Adeyemo said countries in Asia and Africa also would be able to take advantage of the cap by buying Russian oil at a cheaper price.
"Our hope is that countries like China and India will join the price cap coalition, or take advantage of the price cap coalition, to lower the amount of money" that Russia makes from oil exports, Adeyemo said.
Russia has pledged not to sell oil to countries participating in the cap.
Asked about the impact that American sanctions on Russia may have on the U.S. dollar, Adeyemo said: "I am not worried about the role of the dollar as the global reserve currency."
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