Russian oil is funding Russia’s war

The price cap introduced last year to limit Russia’s oil revenues isn’t working. It was meant to keep the amount paid worldwide for Russian oil to a maximum of $60 a barrel by denying western insurance and other services to firms that shipped it for less. But it turns out there are plenty of firms willing to buy insurance elsewhere in return for Russian business. Moscow claimed to be getting $80 a barrel for its oil last month, and an FT analysis of the “shadow fleet” defying the cap suggests barely a quarter of the 134 ships moving Russian oil in October had western insurance. The cap was introduced by the G7 and its allies last December and at first seemed to be having an effect in that Russia could only sell oil – notably to India – at discounts of up to $40 a barrel. The discount now is as little as $10, and Russia’s war economy is churning out artillery shells 24 hours a day.