“This winter, the European Union will, for the most part, stop buying Russian oil. And, in addition, it will ban the provision of services that allow Russia to transport oil by tanker. And this is likely to cause a spike in its prices oil,” he added. Yellen continued: “Our price cap proposal is designed to both reduce Russian revenues that they use to support their economy and fight this illegal war, while also preserving Russian oil supplies that will help contain global So I think that’s something that might be necessary and it’s something that we’re trying to put in place to avoid a future spike in oil prices. The secretary’s comments could help fuel fears that natural gas prices will rebound after they began sinking last month, providing relief to inflation-weary consumers and an economy mired in a slowdown. The steady decline in prices is due to many factors, including recession fears that have driven down oil prices and the fact that some Americans cut back on driving when gas prices soared above $5 a gallon. Earlier this month, finance ministers from the G7 group of countries — the U.S., Japan, Canada, Germany, France, Italy and the U.K. — said they would ban the provision of “services that enable the maritime transportation of Russian crude oil and oil products of worldwide origin” above the price ceiling. This could prevent insurance coverage or financing for oil shipments. The maximum price will be set by “a broad coalition” of countries, they said in a joint statement. It will come into effect alongside the next batch of European Union sanctions, which include a ban on seaborne imports of Russian oil from early December. Yellen also underscored on Sunday her faith in the Federal Reserve to determine how best to avoid an economic recession, but acknowledged that a possible recession is “a risk when the Fed tightens monetary policy to restore inflation, so it is definitely a risk to watch.” “We’re seeing some slowdown in growth, but that’s natural,” he told Bash, noting the poor state of the economy President Joe Biden inherited in 2021. He added that despite higher food and energy prices, “We have a good, strong labor market and I think it’s possible to maintain that.” Yellen emphasized that she is optimistic about the economy and emphasized that the US is not in recession. In response to high inflation, the Federal Reserve has raised interest rates four times so far in 2022 and is likely to raise rates again this year. CNN’s Alex Stambaugh, Julia Horowitz, Michelle Toh and Matt Egan contributed to this report.
