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A price cap on Russian oil aimed at penalizing Moscow’s war on Ukraine went into effect on Monday.
The cap, which is being imposed by the United States and other countries and is intended to prevent Russia from selling oil at more than $60 per barrel, works by prohibiting access to services such as insurance and trade finance for shipping Russian oil if it’s sold above the price cap.
The Group of Seven (G-7) is imposing the cap on Russian oil that is transported by sea along with the European Union and Australia. According to a Treasury Department fact sheet, the G-7 controls about 90 percent of the market for relevant insurance.
