US Treasury Official Clarifies Stance on Russian Oil Imports
India Emerges as a Top Buyer of Russian Oil
In response to Moscow’s invasion of Ukraine, Western nations imposed sanctions on Russian oil imports. Despite this, India has become one of the leading buyers of Russian sea-borne oil.
Goal of Sanctions and Price Cap
The United States has not requested India to reduce Russian oil imports. The objective of sanctions and the G7-imposed $60 per barrel price cap is to ensure stable global oil supplies while impacting Moscow’s revenue.
Limiting Putin’s Profits
Eric Van Nostrand, the U.S. Treasury’s assistant secretary for economic policy, emphasized the importance of keeping oil supply steady while limiting Russian President Vladimir Putin’s profits. He mentioned that buyers can purchase Russian oil at deeper discounts if they bypass Western services, thereby reducing Moscow’s sales avenues.
Impact of Sanctions on Russian Oil Trade
The sanctions aim to restrict Russia to three options: sell oil under the price cap, offer deeper discounts to buyers circumventing Western services, or shut down oil wells. The G7-imposed price cap prohibits the use of Western maritime services like insurance for tankers carrying Russian oil priced at or above $60 a barrel.
US Treasury’s Actions and Discussions
In February, the United States imposed sanctions on Russian state-run shipper Sovcomflot and its tankers involved in Russian oil transportation. U.S. officials are in India to engage in discussions on anti-money laundering, countering terrorism financing, and implementing the price cap.
Clarification on Refined Products
Anna Morris, acting assistant secretary for terror financing at the U.S. Treasury, clarified that selling refined products produced from Russian oil to Western nations would not breach the sanctions. Once Russian oil is refined in a country, it is no longer considered Russian oil from a sanctions perspective.
