Page 6 - AsianOil Week 34 2022

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US says it has held constructive talks

with India on Russian oil price cap

POLICY THE US has reported that it has had constructive from around the world and Western countries to
discussions with Indian officials on imposing a continue to be used for the purchase and trans-
India and China price cap on Russian oil – a policy that Wash- portation of Russian crude.”
have ramped up oil ington and its allies are proposing to cut Russian Asked if Washington was concerned about
shipments from Russia revenues from hydrocarbon exports, US Dep- Indian companies using currencies other than
to take advantage of the uty Treasury Secretary Wally Adeyemo said on the dollar for trade with Russia, Adeyemo said
significant discount that August 27. the US was “indifferent” to what currency was
it currently trades at. India and China have ramped up oil ship- used for energy payments. Those Indian com-
ments from Russia, taking advantage of the steep panies have resorted to non-dollar currencies
discount that Russian crude sells at compared to to purchase Russian coal and oil imports, with
other benchmarks as a result of sanctions and the yuan, the dirham, euro and the Hong Kong
other difficulties. This has helped Russia offset dollar covering at least 44% of all coal imports
the impact of reduced oil sales to Europe, but the in June.
US wants to limit how much Russia can fetch for Prior to Adeyemo’s comments, Bloomberg
its oil globally, and work to bring down the global had reported that India was intending to tell the
cost of energy. But this will require the support of US that the price cap needed global consensus
both India and China. before New Delhi lends its support. Meanwhile,
“I had a very constructive conversation with Russia was reported by the news agency as hav-
my Indian counterparts about the price cap pro- ing reached out to several Asian countries to
posal, but also talked extensively with private offer long-term oil contracts at steep discounts,
sector participants in India as well,” Adeyemo signalling that Moscow is looking to dissuade
told reporters. them from backing the Western plan.
The Group of Seven nations wants to have the Chinese resistance is likely to prove the
price cap mechanism in place by December 5, biggest obstacle, as it wants to avoid measures
when the EU’s ban on seaborne imports of Rus- that weaken Russia’s position in the standoff
sian oil comes into force. with the West over the war in Ukraine. Getting
“We are very concerned that come December Beijing on board became all the more difficult
5 … we will be in a place where access to Rus- after tensions flared between China and the US
sian crude will diminish for the world and would over the visit to Taiwan by Speaker of the US
potentially lead to higher prices,” Adeyemo said. House of Representatives Nancy Pelosi earlier
“It would allow European, American services this month. ™

P6 www. NEWSBASE .com Week 34 29•August•2022