The energy ceiling is doomed to fail, according to Russia: “The price will rise” | News

“The global market is not limited to seven countries,” he said. “The minimum price announced by the West will become the minimum.” Volodin further writes that countries are becoming aware of their dependence on Russian energy. Attempts to replace the country’s imports of oil and gas failed. In addition, countries can no longer buy “cheap” fuel from Russia, he says.

Last week, the Group of Seven nations announced plans to impose a price cap on Russian oil exports. The major industrial countries want to ensure that Moscow earns less from selling fossil fuels. If these revenues fall, Russia will also be less able to finance its war in Ukraine.

Setting a price cap is a violation of the free market. The idea is to link financial services, insurance and oil freight forwarding to a price ceiling. If a shipper or importer of Russian oil wants to purchase these services, it will have to stick to a fixed maximum price. For example, tankers carrying oil from Russia that were sold at a price higher than the fixed price will not be able to find an insurance company, because they are not allowed to insure. Many existing carriers currently cover environmental disasters or other problems through the UK insurance market.

Russian President Vladimir Putin has already warned That Russia will not supply oil, gas, coal and other fuel products to countries that set price limits for Russian raw materials. The price ceiling has not yet been determined.

The price of European gas fell about 5 percent on Friday shortly after noon. Intercontinental Exchange (ICE)’s leading Dutch “TTF receiver” listed at around 1 p.m. at €208 MWh, a decrease of 5.7 percent. Earlier during the trading day, there was a drop to more than 7 percent.

The price is falling as the European Union overhauls plans to tackle extremely high energy prices. Energy ministers of member states will meet in Brussels on Friday to discuss the issue. Ahead of the emergency meeting, the Czech EU chief said member states should send a “clear signal” that they would “do what is necessary to protect homes and businesses and ensure adequate energy at affordable prices”. He wants an agreement by the end of this month on concrete measures that could mitigate price hikes.

Despite the drop on Friday, the price of gas is still high. The price is about eight times higher than the five-year average for this time of year. And the Dutch gas price closed, Thursday, at 220.4 euros per megawatt-hour. At the end of last month, at €346.5, a record gas price was set at the closing bell.