Defense News 

India & U.S

Two senior US Treasury officials are currently in India, urging the government to maintain the implementation of an oil price cap designed to limit profits to Russia. Acting Assistant Secretary for Terrorist Financing Anna Morris and PDO Assistant Secretary for Economic Policy Eric Van Nostrand are on a visit to New Delhi and Mumbai from April 2-5 for meetings with both government and private sector representatives. The aim is to discuss bilateral issues, including cooperation on anti-money laundering and countering the financing of terrorism, as well as ensuring the continued implementation of the price cap. This cap was introduced by G7 nations, the European Union, and Australia following Russia’s invasion of Ukraine in February 2022. It prohibits the use of Western maritime services for tankers transporting Russian oil priced at or above USD 60 per barrel.

In 2023, Russia became India’s top oil supplier, and given India’s strong economic and defense ties with Russia, it has refrained from openly criticizing Moscow over its conflict with Ukraine.

Morris and Nostrand are set to speak on the price cap and engage in a Q&A session hosted by the Ananta Aspen Centre in New Delhi on Thursday. According to a statement, they emphasized in a blog post last month that the second phase of the price cap is achieving its goals of restricting Russia’s oil profits and maintaining energy market stability.

The decline in the price at which Russia sells its oil since the second phase began reflects not only global oil price trends but also a significant widening in the discount Russia earns relative to other global oil suppliers. This increase in the discount on Russian oil has been linked to the Coalition’s increased enforcement activities reflected in the second phase of the price cap, indicating its effectiveness.

The price cap is playing a role in ensuring a steady supply of energy to global consumers and businesses while providing key importers like India with more leverage in negotiations. Additionally, it is reducing Putin’s profits from selling oil due to key sanctions enforcement measures.

In conclusion, the visit of these US Treasury officials underscores the importance of maintaining the oil price cap to achieve the dual objectives of limiting Russian profits and promoting stability in global energy markets.