The US-priced price cap on Russian oil could aggravate the energy crisis as it does not help solve the supply problem the world is facing, Indonesian Finance Minister Sri Mulyani Indrawati told CNBC on July 15.
According to her, high energy prices are due to demand exceeding supply in the context of supply disruption due to the Russia-Ukraine conflict and the sanctions imposed by the West on the country's energy sector.
"The ceiling price certainly won't solve the problem, because it's basically not enough to meet demand," Indrawati told reporters on the sidelines of a meeting of the finance minister and G20 central bank governors in Bali, Indonesia.
Indonesian officials note that the gap in supply and demand in the energy sector will only widen in the coming months as the heating season approaches.
The G20 finance minister's comments came amid the presence of US Treasury Secretary quan Yellen in Asia with the aim of attracting support for the price ceiling for Russian oil. On July 13, Ms. Yellen called price ceilings "one of our strongest tools" to fight inflation.
On the same day, US Assistant Secretary of State Molly Montgomery said that Washington sees the price ceiling for Russian oil as an opportunity to spend less on Russian energy imports and stabilize the global oil market.
However, analysts are skeptical about the feasibility of the measure because Russia may choose not to sell oil at the price cap set by the US.
US National Security Advisor Jake Sullivan recently noted that applying the Russian oil price ceiling mechanism will take time, as many details must be arranged before it can be applied.
The US has tried to persuade India and China to support the imposition of price ceilings on Russian oil, but the possibility of support is uncertain as both countries are buying Russian crude oil at strong discounts.
