News Karnataka
Monday, April 22 2024

US Blacklists 14 Russian Oil Tankers To Enforce Price Cap

Oil Tankers
Photo Credit : News Karnataka

Washington: In an effort to reduce Moscow’s petroleum revenue by enforcing a price cap put in place by the West following the invasion of Ukraine, the United States blacklisted 14 Russian oil tankers on Friday.

The Treasury Department imposed that it would give Sovcomflot, a state-run shipping company, 45 days to remove any oil or other cargo from 14 of its ships before enforcing the sanctions.

The price cap aims to keep supplies to energy markets open while restricting profits for the Kremlin.

Deputy Treasury Secretary Wally Adeyemo said in a statement, “Today, we take the next step by targeting Russia’s largest state-owned shipping company and fleet operator, dealing a huge blow to their shadow operations.”

“We are entering the next phase of increasing Russia’s costs in a responsible manner to mitigate risks,” he added.

Previously, a coalition made up of Australia, the European Union, and the Group of Seven major economies set a $60 price cap per barrel of Russian crude.

But a senior Treasury official told reporters Friday that the Kremlin has sought to evade the cap by investing in a “shadow fleet” of energy market trading infrastructure.

By operating outside of coalition services, Moscow was able to profit from higher summer and fall oil prices.

Washington has focused on “increasing the cost to Russia of using that shadow fleet, of moving oil outside the price cap’s reach,” the official stated on condition of anonymity. This is the reason for their increased focus.

Since the price ceiling was implemented, Russia’s revenue has fallen.

On the eve of the second anniversary of Russia’s invasion of neighboring Ukraine, the actions are taking place.

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