Washington’s Oil Price Cap Won’t Work-And Putin Knows It

Washington’s Oil Price Cap Won’t Work-And Putin Knows It

For the past several months the U. S. has been shopping around other advanced democracies a scheme to coordinate the placement of a cap on the price Russia can charge on its energy exports to deprive Putin of revenues fueling his war in Ukraine. A nearly 50% rise in Moscow's inflow of oil and gas export revenues has been driven by the sector's skyrocketing prices since the onset of the war. To Putin's amusement, Washington's attempt to cobble together an agreement among its allies to cap the price Russia can charge for its oil and gas sales has not been easy going for Washington. U. S. allies are rightly circumspect about the convoluted design of Washington's plan in a market that is far more complex than the U. S. understands; its ability to accomplish the stated goal—terminating Putin's belligerent conduct in Ukraine; and that it's proposal won't backfire, inflicting substantial costs on the advanced democracies, indeed far more than it will on Russia. Meanwhile enlarged oil and natural gas revenues still make their way to Moscow; the bloodshed of Ukrainians mounts; and the already numerous casualties of young Russian male military conscripts rise exponentially. Unfortunately, this is not surprising. In