US/EU sanctions against Russia failed to have desired effect

The US and EU sanctions against Russia have failed to have the desired effect so the US is now trying to limit the profitability of Russian oil sales by putting a price cap on it.

According to Press TV, as the crisis in Ukraine lingers on, the United States and its allies appear to have run out of measures to halt Russia. Collectively they have imposed every imaginable form of sanctions on Moscow; the Russian energy, banking and financial sectors, have all been targeted by the west.

But the punitive measures do not appear to have had the intended results; therefore, the United States is now proposing the idea of putting a price cap on oil procured from Russia.

The west is trying to limit the price of Russian oil in order to deprive the country of the money it needs to run the war. The goal is said to be to set the price at a level that covers the marginal cost of production so that Russia would be encouraged to keep producing oil.

The idea, which was first proposed by Washington, was agreed upon at the G7 summit in June 2022.

Western countries plan to allow only raw materials and oil products whose value does not exceed the price cap.

In reaction to the proposition Russia has declared that it would not export oil to the world market should a price cap be imposed.

It's not yet clear whether Western nations have the capability to implement such a plan but there are already warnings that the scheme may actually backfire.

The Russian President says the price cap would further propel global oil prices upwards and Security Council Deputy Chairman, Dmitry Medvedev, warned that oil would end up being traded at between 300 to 400 US dollars per barrel if the West goes through with the plan.

Some analysts are predicting that the scenario would be catastrophic for the US and the other group of seven countries.

Market analysts have predicted that China and India, two key players in the Asia region, probably will not cooperate with the price cap.

The setting of various sanctions on Russia has already failed to deprive the country of its revenues; they have actually increased the money Moscow makes from energy exports. Oil prices climbed to 14 year record highs shortly after the war began in February.

ME