Russia will stop selling oil to countries that support the price limit

Deputy Prime Minister Alexander Novak considers the idea of the G7 countries to limit the price of Russian oil as “complete nonsense”, which would destabilize the entire industry. According to him, Russia will not supply oil and oil products to those countries that will support the establishment of such a limit.

“We simply for such companies or countries that will impose restrictions, we will not supply them with oil and petroleum products, because we will not work on non-market conditions,” said the Deputy Prime Minister.

He noted that no OPEC+ countries, as well as India and China, supported the idea of limiting oil prices from Russia:

We haven’t heard a single positive response from other oil producers who participate in the market about this absurdity being discussed.

Novak also noted that Russian companies are ready for the EU oil embargo and will be able to keep production at the same level. According to the forecast of Deputy Prime Minister, by the end of 2022 it may reach 520-525 million tons. Last year Russia produced 524 million tons.

According to trading data, after Alexander Novak’s statement, LUKOIL shares are up more than 7%, Bashneft shares – more than 5%.

The idea of a price cap on Russian oil emerged during the G7 summit in late June. The plan proposed by the U.S. is to exempt only those countries that agree to buy fuel at a set price from sanctions in the trucking insurance industry. Tomorrow, September 2, the G7 finance ministers intend to discuss the possibility of imposing such restrictions.