How the West’s price cap on Russian oil could roil energy markets

Russia invaded Ukraine in February, America’s energy policy has pursued two grand, seemingly contradictory aims. The first is to keep global oil supply high enough that prices remain tolerable and public support for sanctions stays strong. The second is to asphyxiate Vladimir Putin’s by stemming the Russia earns by flogging oil barrels. Together they form a circle that is hard to square because, with supply closely tracking demand amid a dearth of new production, taking any oil off the market mechanically triggers higher prices. The West has nevertheless tried to defy the law of physics by crafting a growing array of measures to meddle in oil markets.The ones that have been deployed until now have often been piecemeal and involve uncomfortable compromises. Puncturing its own , on November 26th America granted permission for Chevron, a big American oil firm, to crank up its production there. America has also released huge volumes from its strategic crude-oil stocks; the reserve is now at its lowest level since 1984. The White House’s least productive effort has aimed to cajole Gulf states into pumping more. Within months of President Joe Biden fist-bumping Muhammad Bin Salman, the de facto Saudi ruler, in Riyadh in July, the petrostate and its allies in the Organisation of the Petroleum Exporting Countries () declared they would cut output instead. On December 4th the cartel meets again. It looks unlikely to help by increasing output now.