The G-7 may cap Russia’s oil price — but it won’t dent Moscow’s war chest, analysts say
Picture taken on May 3, 2022 shows a general view of Slovakia’s largest mineral oil refinery Slovnaft in Bratislava, Slovakia. (Photo by JOE KLAMAR / AFP)
Joe Klamar | Afp | Getty Images
The Group of 7 nations are in talks to cap Russian oil at $65 and $70 a barrel — but analysts say it likely won’t have a significant impact on Moscow’s oil revenues even if it’s approved.
Prices at those levels are close to what Asian markets are currently paying Russia, which are at a “big discount,” said Wood Mackenzie’s vice president of gas and LNG research, Massimo Di Odoardo.
“Those levels of discounts are certainly in line with what the discounts already are in the market … It’s something that doesn’t seem, as it is placed, like it’s going to have any effect [on Moscow] whatsoever if the price is so high.”
Russia has threatened to it will not supply oil to countries setting and endorsing the price cap.
“Given Russian oil (Urals) is trading at $60‑65/bbl, the proposed price cap is already compliant under prevailing market conditions,” said Vivek Dhar, Director of Mining and Energy Commodities research from Commonwealth Bank of Australia.
In a note on Thursday, he said that current Russian oil shipments face minimal disruption from the European Union denying shipping and insurance services.
He agreed that the discussed price cap won’t make much of a dent or deter Moscow in its war against Ukraine.
“Russia’s seaborne oil exports have increased to China, India and Turkey at the expense of advanced economies following the Ukraine war,” he added.
In fact, he said the price cap discussed was higher than markets were expecting.
“Oil prices finished lower overnight after the EU discussed a price cap on Russian oil between $US65‑70/bbl, a higher price range than markets expected and at levels that will reduce the risk of disruptions of EU sanctions on Russian oil shipments,” Dhar said.
There was similar skepticism over the EU’s proposed cap on natural gas prices. Several EU member states locked horns over the effectiveness of capping prices at 275 euros per megawatt hour, with some saying it’s not realistic to keep gas prices at such high levels for so long.
The bloc is seeking to stop gas prices from soaring sky-high as consumers are already struggling with rising cost-of-living.
G-7 policymakers have a tough balancing act to tread.
It seems to me like [the G-7] will err on the side of caution — setting it high rather than low to avoid worsening the inflationary spiral.
Pavel Molchanov
Energy analyst at Raymond James
If prices are set too high, they will be meaningless and risk having no impact on Russia — but if the price cap is too low, it could lead to a physical reduction in the supply of Russian oil onto the global market, said Raymond James’ energy analyst Pavel Molchanov.
A lower price cap “means more inflation, more consumer unhappiness, and more monetary tightening,” Molchanov pointed out.
“It seems to me like [the G-7] will err on the side of caution — setting it high rather than low to avoid worsening the inflationary spiral.”
Last week, official data showed U.K. inflation jumped to a 41-year high of 11.1% in October, higher than expected, as energy prices, among other factors, continued to squeeze households and businesses.
Downside risks to current forecasts
If EU members agree to the proposed cap, Dhar expects the price of oil to fall below $95 per barrel for the last quarter of 2022.
Oil prices were fractionally higher on Friday afternoon Asia time. Brent crude futures inched higher by 0.35% to stand at $85.64 per barrel, while U.S. West Texas Intermediate futures climbed 0.55% to $78.37 per barrel.
“Our price forecast assumes EU sanctions accompanied by a price cap on Russian oil will result in enough supply disruption to offset ongoing global growth concerns.”
The European bloc has imposed multiple rounds of sanctions against Russia since since Moscow began its unprovoked war on neighboring Ukraine in late February.
Earlier this week, Goldman Sachs lowered its oil price forecast by $10 to $100 per barrel for the fourth quarter of 2022, citing rising Covid concerns in China and lack of clarity over the Group of Seven nations’ plan to cap Russian oil prices.
Massachusetts is launching a first-of-its-kind statewide vehicle-to-everything (V2X) pilot program. This two-year initiative, backed by the Massachusetts Clean Energy Center (MassCEC), aims to deploy 100 bidirectional chargers to homes, school buses, municipal, and commercial fleet participants across the state.
These bidirectional chargers will enable EVs to serve as mobile energy storage units, collectively providing an estimated 1.5 MW of new storage capacity. That means EVs won’t just be getting power – they’ll be giving it back to the grid, helping to balance demand and support renewable energy use. The program is also focused on ensuring that low-income and disadvantaged communities have access to this cutting-edge tech.
The Massachusetts pilot is one of the largest state-led V2X initiatives in the US and is designed to tackle key challenges in deploying bidirectional charging technology. By strategically placing these chargers in a variety of settings, the program aims to identify and resolve barriers to wider adoption of V2X technology.
Massachusetts EV owners and fleet operators enrolled in the program will get bidirectional chargers capable of both vehicle-to-grid (V2G) and backup power operations at no cost. Here’s what they stand to gain:
- No-cost charging infrastructure: Bidirectional charging stations and installation are fully covered for participants.
- Grid resilience: With an estimated 1.5 MW of new flexible and distributed storage assets, the program strengthens Massachusetts’ energy infrastructure.
- Clean energy integration: V2G technology allows EVs to charge when renewable energy is available and discharge stored energy when it’s not, supporting the state’s clean energy goals.
- Backup power: EV batteries can be used as backup power sources during outages.
- Revenue opportunities: Some participants can earn money by sending stored energy back to the grid.
Clean energy solutions firm Resource Innovations and vehicle-grid integration tech company The Mobility House are leading the program’s implementation. “With the charging infrastructure provided through this program, we’re eliminating financial barriers and enabling school districts, homeowners, and fleets to access reliable backup power,” said Kelly Helfrich of Resource Innovations. “We aim to create a scalable blueprint for V2X programs nationwide.”
“Bidirectional charging benefits vehicle owners by providing backup power and revenue opportunities while strengthening the grid for the entire community,” added Russell Vare of The Mobility House North America.
The program is open for enrollment now through June 2025. For more details, visit the MassCEC V2X Program webpage. A list of eligible bidirectional vehicles can be found on that page.
Read more: Cambridge’s new solar VPPA is the largest ever by any US city
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Compton, California, has unveiled 25 new electric school buses – the school district’s first – and 25 Tellus 180 kW DC fast chargers.
Compton Unified School District (CUSD) in southern Los Angeles County is putting 17 Thomas Built Type A and eight Thomas Built Type C electric school buses on the road this spring. In addition to working with Thomas Built, CUSD also collaborated with electrification-as-a-service provider Highland Electric Fleet, utility Southern California Edison, and school transportation provider Durham School Services.
Environmental Protection Agency’s (EPA) Clean School Bus Program awarded funds for the vehicles in the program’s first round. EPA also awarded CUSD funds for the third round of the program and anticipates introducing an additional 25 EV school buses in the future.
“I can’t stress enough how vital grants like these are and the need for continued support from our partners in government at the state and federal level to fund additional grants for school districts and their transportation partners that are ready to deliver and operate zero-emission buses,” said Tim Wertner, CEO of Durham School Services.
CUSD, which serves Compton and parts of the cities of Carson and Los Angeles, currently serves more than 17,000 students at 36 sites. The district has a high school graduation rate of 93% and an 88% college acceptance rate. One in 11 children in Los Angeles County have asthma, which makes the need for emissions-free school transportation that much more pressing.
Read more: Thomas Built Buses debuts its next-gen electric school bus
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After cutting lease prices by $200 this month, the Rivian R1S is now surprisingly affordable. It may even be a better deal than the new Tesla Model Y.
Rivian cuts R1S lease prices by $200 per month
Rivian’s R1S is one of the hottest electric SUVs on the market. If you haven’t checked it out yet, you’re missing out.
With some of the best deals to date, now may be the time. Rivian lowered R1S lease prices earlier this month to just $599 for 36 months, with $8,493 due at signing (30,000 miles). The offer is for the new 2025 R1S Adventure Dual Standard, which starts at $75,900.
Before the price cut, the R1S was listed at $799 per month, with $8,694 due at signing. The electric SUV now has the same lease price as the R1T, despite costing $6,000 more.
The 2025 R1T Dual Motor starts at $69,900, essentially making it a free $6,000 upgrade. At that price, you may even want to consider it over the new Tesla Model Y.
Tesla’s new Model Y Launch Series arrived with lease prices of $699 for 36 months. With $4,393 due at signing, the effective rate is $821 per month, or just $13 less than the R1S at $834. However, the 2025 R1S costs nearly $15,000 more, with the Model Y Launch Series price at $59,990.
Rivian is also offering an “All-Electric Upgrade Offer” of up to $6,000 for those looking to trade-in their gas-powered car, but base models are not included.
| Starting Price | Range (EPA-est.) |
|
| 2025 Rivian R1S Dual Standard | $75,900 | 270 miles |
| 2026 Tesla Model Y Launch Series | $59,990 | 327 miles |
To take advantage of the Rivian R1S lease deal, you must order it before March 15 and take delivery on or before March 31, 2025.
The 2025 Rivian R1S Dual Standard Motor has an EPA-estimated range of up to 270 miles. Tesla’s new Model Y Launch Series gets up to 327 miles.
Which electric SUV would you choose? Rivian’s R1S or the new Tesla Model Y? If you’re ready to check them out for yourself, you can use our links below to find deals on the Rivian R1S and Tesla Model Y in your area.
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