U.S. proposes capping Russian oil prices in $60 range

U.S. Treasury Secretary Janet Yellen said that a price cap on Russian oil exports in the $60-a-barrel range would likely be sufficient to reduce Moscow's energy revenues while allowing profitable production.

Yellen told an event at the International Monetary Fund and World Bank meetings in Washington that the U.S. and its Western allies are still discussing where to set the price for a capping mechanism.

Backers of the cap, which would deny Western-supplied shipping insurance, finance other services to Russian oil cargoes above a specified price, aim to implement it on Dec. 5, as the European Union implements a phased ban on Russian crude.

Yellen said that Russia has been willing to produce and sell oil in the $60 range over the past five to seven years. "So certainly a price in that range would be sufficient to feel that Russia could profitably produce and sell oil," Yellen said, adding that Russia's cost of production was "low."

"The objective is to protect the world from the consequences of a global spike in oil prices," Yellen said of the price cap.