US deputy treasury secretary Wally Adeyemo on Friday said Washington wants India to join the coalition that is seeking to impose a price cap on Russian oil. The restriction is aimed at squeezing revenue streams for Moscow and softening the global energy prices.
“I had a very constructive conversation with my Indian counterpart (finance minister Nirmala Sitharaman) on the price cap proposal. But I also talked to the private sector participants in India about price cap as well. Ultimately, we share the same objective, which is making sure that our consumers and businesses pay the lowest price possible for energy,” Adeyemo told reporters here. He concluded a three-day visit to India on Friday.
The Russia-Ukraine war has disrupted the global supply chain, which has resulted in rising prices of crude oil and some food products.
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Following Western sanctions on Russian oil, India, however, has started lapping up discounted oil in its effort to tame a stubborn inflation. India meets 85% of its crude oil needs via imports.
“The price cap can reduce the Russian revenue and reduce the price for consumers,” Adeyemo said. The proposal to cap prices of Russian oil is aimed at curbing the oil revenue that Moscow uses to finance its invasion in Ukraine, while also encouraging Moscow to produce oil and the consuming nations get them at affordable prices.
“India, US and countries in other parts of the world are paying too much for energy today because of Russia’s unjustified war in Ukraine. The goal of the price cap is to lower the price,” he said.
Can the cap be set lower than what India is paying now? The US deputy treasury secretary said that the idea of capping the price for Russian oil is to ensure that consuming nations such as India pay the lowest possible price, while still pay a price that will encourage Russia to continue to produce.
“If India joins the coalition, it can have a say in deciding the price cap,” he said.
“We are aligned with India in terms of ensuring that the consumers get the lowest price possible and the best way to do that is by making sure that we get as much supply in the market as possible and also by putting in place a possible price cap,” he said.
