Yellen warns of failure to agree on Russia oil price cap

Aug 31, 2022, 12:21 AM | Updated: 12:29 pm
Treasury Secretary Janet Yellen, right, gestures to the United Kingdom's Chancellor of the Excheque...

Treasury Secretary Janet Yellen, right, gestures to the United Kingdom's Chancellor of the Exchequer Nadhim Zahawi during their meeting at the Treasury Department, Wednesday, Aug. 31, 2022, in Washington. (AP Photo/Jacquelyn Martin)

(AP Photo/Jacquelyn Martin)

WASHINGTON (AP) — Treasury Secretary Janet Yellen on Wednesday warned that a failure to place a price cap on Russian oil would hurt the global economy.

“Without a price cap, we face the threat of a global energy price spike if the majority of Russian energy production gets shut in,” Yellen said at the start of a meeting with her British counterpart, Nadhim Zahawi.

The European Union has decided to ban nearly all oil from Russia by the end of the year. It also will ban insuring and financing the maritime transport of Russian oil to other countries. Unless a price cap is implemented, prices will almost certainly spike.

The U.K. and other Group of Seven countries tentatively agreed in June to pursue a ceiling on the price of Russian oil. Getting as many other nations as possible to agree to join a buyers’ cartel has been one of Treasury’s main objectives as it seeks to curb Russia’s ability to finance its war in Ukraine.

Yellen said there has been “substantial progress” toward making the price cap a reality and she was optimistic it would happen.

Zawahi, who became chancellor of the Exchequer on July 5, said Britain intends to “influence key nations” to join the plan.

The Kremlin’s main pillar of financial revenue — oil — has kept the Russian economy afloat despite export bans, sanctions and the freezing of central bank assets.

Limiting the price would reduce the Kremlin’s income from oil, and a cap would encourage the country to continue producing, Treasury officials have said. World leaders fear that Russia could, however, constrict its energy supply in retaliation, causing prices to spike.

Yellen said a price cap also would limit the impact of higher oil prices on inflation in consuming countries, with the cost of gasoline and diesel still squeezing consumers and businesses hard, especially in Europe.

To be effective, participating countries would have to collectively agree to purchase the oil at a lower-than-market price.

China and India, two countries that have largely resisted signing onto efforts to punish the Kremlin and have maintained business relationships with Russia during the war, will need to get on board.

Zawahi said “there is obviously some more to be done and we’re ready to work in particular to persuade more countries to support the measure,” citing India, Turkey, South Africa and others as possible participants.

Treasury leaders have been visiting allies and neutral parties in the war to call for their participation, even if informally.

Yellen traveled to the Indo-Pacific in July and Treasury Deputy Secretary Wally Adeyemo met with government ministers and business leaders in India in mid-August, in part to push for the price cap.

The Biden administration is keeping a close eye on the progress of the talks.

“We believe it’s not only an idea worth exploring, it’s an idea worth implementing,” John Kirby, a national security spokesman, told reporters Wednesday. “And we look forward to hearing what the finance ministers say at the end of the week.”

__

Associated Press reporter Aamer Madhani contributed to this report.

__

Follow AP’s coverage of Russia’s war in Ukraine at

https://apnews.com/hub/russia-ukraine.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - Gov. Phil Bryant speaks about his legacy following a life of public service, Jan. 8, 2020, i...
Associated Press

Texts: Favre also sought welfare money for football facility

JACKSON, Miss. (AP) — After Mississippi spent millions of dollars in welfare money on Brett Favre’s pet project, a university volleyball arena, the retired NFL quarterback tried two years later to get additional cash from the state’s welfare agency for another sports facility, new court documents show. The governor at the time, Republican Phil Bryant, […]
16 hours ago
Associated Press

Police: Man arrested in California plotted mass shooting

CHICO, Calif. (AP) — A 37-year-old man was arrested Sunday in Northern California on suspicion of threatening to kill police officers and planning a “Las Vegas-style” mass shooting, authorities said. The suspect was taken into custody by SWAT officers at a Super 8 motel in Chico after detectives obtained evidence of his plot, according to […]
16 hours ago
Associated Press

Official: 2 killed amid crashes during pop-up NJ car rally

WILDWOOD, N.J. (AP) — Authorities in New Jersey say at least two people were killed amid multiple crashes at a pop-up car rally in Wildwood over the weekend. Mayor Pete Byron told NJ Advance Media Sunday that there were a series of car crashes related to the “unsanctioned” car meet-up event, NJ.com reported. Byron said […]
16 hours ago
Associated Press

Little evidence of political argument before teen’s death

BISMARCK, N.D. (AP) — There is little indication that an 18-year-old who died after being struck by an SUV in North Dakota was a political extremist like the driver claimed. Investigators say none of the witnesses they have interviewed support the idea that there was a political argument before authorities say Shannon Brandt struck Cayler […]
16 hours ago
Demonstrators hold placards outside the Iranian Embassy in London, Sunday, Sept. 25, 2022. They wer...
Associated Press

Unrest erupts near Iranian embassy in London over death

LONDON (AP) — Violent street protests erupted outside the Iranian embassy in London on Sunday, with rocks thrown at police and five protesters arrested. Large crowds have been gathering all week outside the Knightsbridge compound in protest against the death in Iranian police custody of 22-year-old Mahsa Amini in Iran. She had been arrested by […]
2 days ago
Cuba's President Miguel Diaz Canel walks with his wife Lis Cuesta Peraza before casting his vote at...
Associated Press

Cuba holds unusual vote on law allowing same-sex marriage

HAVANA (AP) — Cuba held a rare referendum Sunday on an unusually contentious law — a government-backed “family law” code that would allow same-sex couples to marry and adopt, as well as outlining the rights of children and grandparents. Cuba holds parliamentary elections every two years, though no party other than the Communist is allowed, […]
2 days ago

Sponsored Articles

Anacortes Christmas Tree...

Come one, come all! Food, Drink, and Coastal Christmas – Anacortes has it all!

Come celebrate Anacortes’ 11th annual Bier on the Pier! Bier on the Pier takes place on October 7th and 8th and features local ciders, food trucks and live music - not to mention the beautiful views of the Guemes Channel and backdrop of downtown Anacortes.
Swedish Cyberknife Treatment...

The revolutionary treatment of Swedish CyberKnife provides better quality of life for majority of patients

There are a wide variety of treatments options available for men with prostate cancer. One of the most technologically advanced treatment options in the Pacific Northwest is Stereotactic Body Radiation Therapy using the CyberKnife platform at Swedish Medical Center.
Work at Zum Services...

Seattle Public Schools announces three-year contract with Zum

Seattle Public Schools just announced a three-year contract with a brand-new company to the Pacific Northwest to assist with their student transportation: Zum.
Swedish Cyberknife 900x506...

June is Men’s Health Month: Here’s Why It’s Important To Speak About Your Health

According to the Centers for Disease Control and Prevention, men in the United States, on average, die five years earlier than women.
...

Anacortes – A Must Visit Summertime Destination

While Anacortes is certainly on the way to the San Juan Islands (SJI), it is not just a destination to get to the ferry… Anacortes is a destination in and of itself!
...

Ready for your 2022 Alaskan Adventure with Celebrity Cruises?

Celebrity Cruises SPONSORED — A round-trip Alaska cruise from Seattle is an amazing treat for you and a loved one. Not only are you able to see and explore some of the most incredible and visually appealing natural sights on the planet, but you’re also able to relax and re-energize while aboard a luxury cruise […]
Yellen warns of failure to agree on Russia oil price cap