The energy battle between Russia and the West escalated dramatically Friday, with Western countries making a concerted push to cap the prices of Moscow’s oil and gas exports, while Russia announced it won’t be restarting the crucial Nord Stream pipeline.
Finance ministers from the G7 group of industrialized democracies called for devising a system that would only allow the sale of Russian oil at below-market prices. The European Commission president also called for capping Russian gas prices. The aim is to limit the Kremlin’s income from selling fossil fuels, which helps finance its invasion of Ukraine.
Within hours, Moscow hit back. Gazprom announced an indefinite shutdown of its vital Nord Stream gas pipeline to Germany, a move likely to be seen as a fresh economic assault on the European Union by the Kremlin.
Friday’s rapid trading of blows between Russia and the West over energy shows how high the stakes now are. Western governments are grappling with an energy crunch that’s driving inflation, while at the same time seeking to pile maximum pressure onto Moscow by targeting Russian fossil fuel exports. [Continue reading…]