Dave DeCamp Economy Foreign Policy nato Russia-Ukraine

US, Allies Discussing Trying to Cap Russian Oil at $40-$60 Per Barrel

Experts are warning the plan won't work and trying to implement it could bring oil prices over $300 per barrel.
Ludvig14, CC BY-SA 4.0 , via Wikimedia Commons.

By Dave DeCamp / Antiwar.com

Bloomberg reported Wednesday that the US and its allies have discussed trying to cap the price of Russian oil around $40-$60 per barrel as the West wants to limit Russia’s profits without sending the price of oil even higher. Oil is currently hovering around $100 per barrel on the global market.

But the US-proposed plan is doomed to fail as it requires Moscow’s cooperation, and experts are warning if Russia retaliates by cutting production, prices could skyrocket. Analysts at JPMorgan Chase said in the worst-case scenario, oil prices could soar to $380 per barrel.

Last week, President Biden attended a G7 summit in Germany, and the G7 leaders released a joint statement that said they were exploring the idea of a price cap on Russian oil. Japan, a G7 nation, has reportedly put forward a proposal to implement the price cap, prompting warnings from Russia.

Former Russian President Dmitry Medvedev, who currently serves as the deputy chairman of Russia’s Security Council, warned Japan that implementing the price cap could bring prices above $300-$400 per barrel, signaling Moscow would retaliate.

“There will be significantly less oil on the market, and its price will be much higher. Moreover, higher than the predicted astronomical price of $300-400 per barrel,” Medvedev said.

Japanese experts told the Russian news agency Tass that they don’t think the price cap is practical since it requires cooperation from China and India, which have significantly increased their purchase of Russian oil and are already buying it at a discount.

Demonstrating India and China’s increased imports, Bloomberg reported Russia has pocketed $24 billion in energy sales to the two nations in just two months. With the increase in exports to Asia, Russia has surpassed Saudi Arabia as China’s top oil supplier.

Dave DeCamp

Dave DeCamp is the news editor of Antiwar.com, follow him on Twitter @decampdave.


  1. Ironic that this insipid short post cites criminal organizations — Bloomberg and JP Morgan Chase. So amazing, we have the rabid pit bulls guarding the hen house.

    USA? Don’t we got fracked gas? LP? Coal? Hmm, is it ZioLensky’s stuff, direct line to that Nazi Regime?

    Ahh, so, we have not mutual aid, no regional planning, nothing in this dog-eat-dog society (sic). Stop citing criminal outfits. Michael Bloomberg? Jaime Dimon?


    1. A shame you discredited your own comment with a needless racist dig. That, too, is a knee-jerk response by those suffering Ango-American superiority complexes.

  2. The arrogance of “The West” is really something to behold. It would almost be funny if it wasn’t rapidly increasing the possibility of ending life on earth.

  3. The main result of this mad plan has been to reveal the utter intellectual bankruptcy of the entire neoliberal system? Whither the free market now? Whither price discovery? Global markets? Deregulation? Free trade? Instead we have financialized apparatchiks proposing with a straight face the mother of all price control schemes. The Soviets wouldn’t get a look in.
    There isn’t any point trying to discern a coherant policy position from the western political class anymore. They have regressed to rule by capricious fiat. Philosophers and economists alike play second fiddle to the latest twitter hashtags.

  4. The price is the seller’s choice. US/UK imposed heavy sanctions on Russia and is stuck with the consequences. Free countries will make their choices, themselves.

  5. Oil Price cap is economic self annihilation of the west and won’t ever work as punishment for Russia. In fact it would make Russian oligarchs richer.

    As of last month Russian economy entered.. deflation of prices. All the 11% GDP Q1 losses erased as Russia entered positive GDP growth in July.

    In contrast US is in 6% technical recession of Q1,Q2, before significant collapse of employment even begun. US and the west faces dead end of stagflation (slow economic growth and associated high monetary inflation )mostly because of massive removal of dollar dominance from global trade by financial and economic sanctions against Russia and China and others.

    How this oil price cap proposal is absurdly one can see when one considers the fact that this price cap is not oil price cap but Russian oil price cap alone.

    What it means is that when someone purchases Russian oil for $60 he can sell it legally for $120 next day before tanker reaches next port and who among global capitalists would pass such opportunity.

    But it is even worse. Right now India increased Russian oil imports in Rubles, with no violation of sanctions, at least 5 times in last six months but not only for their own consumption alone.

    They are re-exporting this oil and better yet refining it and then export the resulting petrochemical products to E.U. and US for much higher prices. Irony is that this very oil was previously refined in EU and US . Now all the profits are made in India and elsewhere not only in the west.

    The uS belligerence versus Iran and Venezuela makes any increase in crude oil supply nearly impossible. OPEC is maxed out predict decrease of output.

    If they try to price-cap oil from all sources Saudis won’t like it at all and they promptly drop Petro-Dollar for Yuan as they already trade Shanghai crude oil benchmark and western financial system would collapse.

    Yuan would reach parity with dollar. If China demands to buy all commodities and sell all products in Yuan western economies are damned. Price shock in the west would be enormous. Hundreds of millions would be pauperized their assets worthless.

    What about Shale oil boom? Forget it.

    The Shale oil fracking was always a fraud and now out of almost 2000 wells in US in 2017 only half are still working with a quarter of efficiency as efficiency of fracking collapses in short time exponentially. There was almost no fracking CapEx in last four years.

    That is why oil fracking was developed in 1949 and almost immediately discarded as extremely uneconomic, with CapEx requirements order of magnitude more expensive than regular oil production and most of all devastating to environment especially water.

    Needless to say that none of hundreds of fracking companies in the world made any profit at all and were just Ponzi scheme attracting new investors to pay old investors.

    Now Hedge Funds that were ordered by FED to bail out US Fracking companies in 2017-18 are ripping most of the profits from $100+ crude oil. Wall Street is the first to oppose this ridiculous price cap.

    The only way to collapse price of oil is to collapse western economies and that exactly what such suicidal western policies lead toward.

    And such pauperization of western population and economic collapse can be done. The scam of COVID lockdowns did it nicely and will do it again unless people wake up from totalitarian torpor.

    1. “Putin’s great innovation is that he disliked the influence and wealth of the oligarchs. he did not like the patrimonial relations created by Yeltsin; he reduced their wealth by half and reditributed to the people via social programs”. Ivan Szelyeni :New Left Review…mandatory state paid parental leave, price controls on necessary commodities, tuition free university, universal health care

  6. anglo masochism self hatred more intense ubiquitous…USA extracts at a cost of 40-50$ per barrel, Russia 3-4$ per barrel and sells higher quality Urals for more than Brent crude….

  7. You’ve got to wonder. The U.S. and its allies seem enamored to the proposition: Why be smart, when you can be stupid. absolutely amazing!

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