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A proposed price cap on Russian oil exports will only work if countries beyond Europe and the United States join the scheme, Shell Chief Executive Ben van Beurden said on Wednesday, Reuters reported.

The G7 countries have agreed to impose a ban on the transportation of Russian oil sold above a certain price. China and India, which are not G7 members, are the largest importers of Russian oil.

“Price caps will only work if you have a very large participation in the price cap system,” van Beurden told reporters.

“If you have only, shall we say, countries in Europe and the United States and a few others agreeing to or imposing a price cap then you will continue to see what is currently happening, which is, Russian crude will go to countries who are perfectly okay to still purchase Urals for instance,” he said.

The proposal discussed by the G7 included imposing a price cap through insurance companies, which would mean that non-compliant cargoes would not be insured.

“I’m not entirely sure whether that will work and who gets punished – whether it’s the insurance companies or somebody else,” van Beurden said. “I’m not saying that it can’t work but I think it would be premature to draw a conclusion.”

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