Forbidden gathering: Canada seeks to strengthen sanctions against the Russian energy sector

Canada will seek to strengthen sanctions against Russia in the energy sector at the G7 summit. Canada is trying to oust Russia as its main competitor from the oil and gas market under the pretext of blocking channels for financing its oil and gas production, Russian Ambassador to Ottawa Oleg Stepanov told Izvestia. It is expected that the agenda of the summit will include lowering the "price ceiling" and restrictions against the tanker fleet. However, the final decision will be for the United States, which so far prefers to maintain a dialogue with Moscow. New possible restrictions against the Russian energy sector can be found in the Izvestia article.

What sanctions will be discussed at the G7 summit in Canada

Canada will seek to strengthen sanctions against Russia in the energy sector at the G7 summit, Russian Ambassador to Ottawa Oleg Stepanov told Izvestia. Increasing pressure on Russia and continuing unconditional assistance to Kiev are stated as a priority of the G7 leaders' meeting, which will be held on June 15-17 in Kananaskis, Canada.

— Representatives of the Carney cabinet have repeatedly advocated for increased restrictions in the energy sector. After all, we are perceived here as Canada's direct competitor in the global oil and gas market. Therefore, they want to undercut the Russian hydrocarbon trade through all sorts of "price ceilings" and restrictions against the tanker fleet. Cutting off the channels of financing of the SVO is a sloganeering pretext," the Russian ambassador to Canada told Izvestia.

Conceptually, Canada's policy towards Russia has not changed since the departure of the previous prime Minister, Justin Trudeau. Ottawa still lives by the illusions of inflicting a strategic defeat on Russia, is focused on maximum support for the Kiev regime, and declares that the only possible "just and lasting peace" is the complete restoration of Ukraine's borders before 2014, Stepanov stressed.

Canada, which is hosting the G7 summit in 2025, declined to announce the agenda of the event in advance. Information about the results of the summit will be available after its completion, the Canadian Embassy in Russia told Izvestia.

In May, the finance ministers and central bank governors of the G7 countries agreed in a joint communique to explore all possible options, including "further strengthening of sanctions against Russia."

The EU will come up with a proposal to lower the ceiling on Russian oil prices, European Commissioner for Economics Valdis Dombrovskis said. Brussels will propose lowering the ceiling to $50 per barrel instead of the current level of $60, according to Reuters. According to Bloomberg, the United Kingdom has joined this demand. French Finance Minister Eric Lombard said that the issue of lowering the price ceiling is being discussed, but no final decision has been made yet. The Japanese authorities have so far refrained from making statements about the tightening of the "oil ceiling."

A separate issue concerns the shipping of oil. The latest EU and UK sanctions packages include an increasing number of vessels allegedly carrying Russian oil. 189 new tankers were included in the 17th package of European sanctions alone.

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Recall that the G7 countries (Great Britain, Germany, Italy, Canada, France, Japan and the United States, the EU leadership is also participating in the meetings) introduced a ceiling on prices for Russian oil in December 2022, and in February 2023 restrictions against petroleum products from the Russian Federation came into force. Companies from these countries are prohibited from providing transportation and insurance services for Russian oil and petroleum products if they are sold at a price higher than the limit.

Anticipating global stagnation, various analysts forecast Urals crude oil prices in the range of $55 to $65 per barrel. It turns out that the current ceiling is practically not working. Therefore, there is a possibility that the G7 countries may lower the price ceiling for Russian oil to $50 per barrel, Ekaterina Arapova, deputy dean of the MGIMO Faculty of International Relations at the Russian Foreign Ministry, told Izvestia.

— The negative consequences for the Russian economy will be minor and short-term. As a reaction to the first price ceiling, we saw a decline in the stock prices of our oil companies, but investors began to react quite quickly and the quotes recovered. Now the situation is even more optimistic, because over the past time the market has adapted in terms of infrastructure and ship security for oil transportation," the expert said.

Canada is now looking for new sources and resources to support its oil industry, because the global situation is developing negatively for it due to Donald Trump's trade policy. Competition between Canada and the United States in European markets is also getting tougher, with Ottawa losing out, as Washington has much more leverage over Europe. Therefore, Canada is paying attention to the Asian and American markets friendly to Russia, but it is unlikely that this strategy will be effective, concluded Arapova.

Will the United States impose new sanctions against Russia

Despite the position of Canada and the EU, the decision on new sanctions against Russia will not be made without the approval of the United States. Washington has so far refrained from imposing restrictions on Moscow in order not to disrupt the negotiation process, Donald Trump said earlier. This position was also defended by American diplomats in the Group of Seven. For example, in February, a reference was removed from another statement by the G7 member countries that the members of the association would instruct their finance ministers to "limit or adjust the marginal prices for Russian oil in an attempt to push Moscow to negotiate."

At the same time, the opinion in the US Congress is strengthening about the need for new restrictions on Russia due to the continuation of the conflict in Ukraine. The bipartisan bill by Republican Senator Lindsey Graham (listed in Russia as a terrorist and extremist) and Democratic Senator Richard Blumenthal provides for the imposition of duties of 500% on imports from countries that buy oil, petroleum products, natural gas, uranium and other goods from Russia. According to the authors of the bill, 82 out of 100 senators support it.

Trump asked Republicans in the Senate not to put it to a vote yet, although the authors had previously intended to adopt it by June 15. The American president is demonstrating his intention to conduct direct negotiations. In particular, on June 4, the heads of Russia and the United States had a telephone conversation, during which they discussed the second round of negotiations between the Russian and Ukrainian delegations in Istanbul. According to Russian presidential aide Yuri Ushakov, Trump confirmed that the United States had not been informed about the Ukrainian strikes on Russian military airfields that took place last Sunday.

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The Trump administration still assumes that the negotiation process on Ukraine may end with some result. That's why they are in no hurry to push Moscow away from the negotiating track, Ivan Loshkarev, associate professor of political theory at the MGIMO Department of the Russian Foreign Ministry, told Izvestia.

— The second reason has to do with Senator Graham himself. He is facing primaries in which the main point of criticism will be his support for Ukraine to the detriment of the interests of voters. Therefore, the senator himself does not seek to promote this bill, but only keeps on the political agenda an option that meets the interests and preferences of American "hawks," the expert said.

In the United States, according to analysts, several areas of sanctions expansion are being discussed. The first is Russian retail and online commerce, which affects the daily lives of Russians and which largely depends on the import of goods. The second is the banking sector. So far, the sanctions apply to individual banks, which makes it possible to transfer transactions to other banks and continue doing business. Broader sanctions against Russian banks could hit Russian enterprises, including exporters, Loshkarev concluded. Nevertheless, Russia has repeatedly demonstrated the ability to adapt to sanctions pressure. In addition, it is worth noting that such restrictions will always be detrimental to those who take them. Especially considering that some American companies have already shown interest in returning to the Russian market.