Russia is threatening to stop selling oil to Ukraine's Western allies after rejecting a planned $60 per barrel price cap.
Dmitry Peskov, a spokesman for the Kremlin, stated on Saturday that Russia will need more time to respond formally but will not accept the price ceiling agreed upon by the U.S., Japan, Canada, Britain, Australia, and the European Union on Friday as a measure to cut Putin's funding for the war in Ukraine.
Its cap and an EU embargo on Russian oil delivered by sea were to take effect on Monday.
Russia's permanent envoy to international organizations in Vienna, Mikhail Ulynov, criticized the agreement by Ukraine's Western backers and warned that they would come to regret their decision.
"Starting this year, Europe will be without Russian oil," tweeted Ulyanov. "Moscow has made it very clear that it would not provide oil to nations that support anti-market pricing limits. Wait, the EU will soon accuse Russia of employing oil as a weapon."
The office of Ukrainian President Volodymyr Zelensky demanded an even lower price ceiling, arguing that the one approved by the European Union and the Group of Seven leading countries was insufficient.
Brent Crude oil, the type most commonly used in Europe, finished at $85.42 per barrel on the open market, although Russia's oil has been selling for approximately $60 per barrel.
On Friday, the G7 nations joined Australia and the EU in accepting the price cap, which had been delayed by Poland, which wanted to cut the cap further but backed down when other countries suggested they would withdraw.
"The G7, European Union, and Australia have now jointly set a cap on the price of seaborne Russian oil," Treasury Secretary Janet Yellen said in a statement on Friday. "This will help us achieve our goal of restricting Putin's primary source of revenue for his illegal war in Ukraine while preserving the stability of global energy supplies."
Yellen noted that the price ceiling will benefit low- and middle-income nations already coping with increased energy and food prices, which the conflict in Ukraine has exacerbated.
"Whether these countries purchase energy inside or outside the quota, the cap will allow them to negotiate for steeper discounts on Russian oil and benefit from improved market stability," Yellen said.
If Russia, one of the world's largest oil producers and a key source of energy for Europe, cuts off fuel supplies to the Western world and its allies, it could cause gas prices to rise worldwide, including in the United States, where the Biden administration has made lowering gas prices a priority, according to Bloomberg. Analysts at JPMorgan Chase anticipated that the price of a barrel might soar to $380.
In October, Biden asked American oil producers to raise output to reduce prices for consumers.
Biden stated in an address at the White House on October 19: "You should use these record-breaking revenues to enhance output and refining." "Invest in America for the people of America. Reduce the price at the pump to reflect what you actually pay for the product."
To cut prices, Biden also released 15 million barrels of oil from the Strategic Petroleum Reserve.