The measure would be an alternative to a price cap for Russian oil, as US President Joe Biden brought it up for discussion. The ifo economist takes a critical view of this proposal.
Ifo President Clemens Fuest has spoken out in favor of import duties on deliveries from the country with a view to Russian income from energy exports. Fuest told the “Neue Osnabrücker Zeitung”: “Import duties have significant advantages over boycott measures. You could skim off part of the income that flows to Russia today.”
When it comes to gas in particular, however, politicians seem to fear that Russia could react to a tariff by immediately ending gas supplies. According to the economist, whether this fear is justified is “another matter”.
The economist, on the other hand, is critical of a price cap for Russian oil, such as that brought up for discussion by US President Joe Biden. “An argument against such a measure is that oil is then mainly supplied to countries that do not participate and offer more. It is therefore important that enough countries participate and that no one backs down. Then such a measure could reallocate income from the oil producing countries in favor of the net importers.”
US President Biden traveled to the G7 summit with the plan for a price cap on oil from Russia. The G7 countries now want to examine such a mechanism more closely and also examine the possibilities for a price cap for gas from Russia.
The Kiel Institute for the World Economy (IfW) recently spoke out in favor of import duties on Russian oil and gas. They are preferable to a price cap.
