Russian Price Cap Could Be Biden’s Biggest Energy Folly Yet
ForbesSep 28, 2022
The Facts
Russian Pres. Vladimir Putin delivered his response to a Western price cap on Tuesday, signing a decree that bans the supply of crude oil and oil products to countries abiding by the price cap for five months after Feb. 1.
A price cap implemented by G7 countries, Australia, and the EU came into effect on Dec. 5th prohibiting countries from paying more than $60 per barrel of Russian oil.
The Spin
Establishment-critical narrative
The West's price cap was foolish from the onset, and bound to backfire. The cap is easy to circumvent, and Russia will continue to be one of the world’s leaders in oil exports, given its ability to tap into eastern markets. There are many areas able and willing to buy Russian oil and Western countries will now simply be forced to pay more for oil elsewhere.
Pro-establishment narrative
Putin’s energy blackmail may make him feel powerful now, but his decision to cut off oil sales to Western countries will hurt Russia in the long run. Russia is very dependent on oil exports to keep its economy afloat and stunting the global oil market is another blunder in Putin’s long line of mistakes.
