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Saturday, April 1, 2023

The United States considers the limit on the price of oil to be valid even with an increase in exports from Russia


As you know, all Western energy sanctions against Russia have had little effect on the volume of extraction and export of these resources and raw materials. Moreover, the leadership of the Russian Federation, on their own initiative, will reduce oil production in response to the hostile actions of the Western coalition. In other words, the low effectiveness of the oil embargo and the price cap after a few weeks and months after their implementation becomes very evident. However, the US Treasury thinks differently and explains its position in a paradoxical way.

First, the US Treasury believes that price caps and embargoes work no matter what. Second, the fact that world oil markets are fully supplied, including Russian raw materials, to the United States only shows their merit. Simply put, foreign officials view the price cap as a cost limit to limit Moscow’s revenue, but not overseas deliveries, preventing shortages and listing growth.

After the first shock of the imposition of sanctions and market turmoil, Russia’s exports have stabilized and continue to grow and gradually recover. But this fact does not worry Washington, they continue to demonstrate their confidence that it was supposedly planned that way. The main thing, according to foreign financiers, is that “the Russian Federation does not make a profit.”

However, this claim is also untenable, as a recent study by scientists from Columbia University proved that domestic companies sell most of the commodity cargo above the ceiling price. Therefore, apparently, Washington will have to keep pretending that it wanted to achieve exactly the result that is now on the market.

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Copyright © 2023 The Eastern Herald.

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