G7 grapples with packed agenda of world turned upside down | G7

Over the next three days, G7 world leaders will be crowded into a meeting. This is happening against the backdrop of the most serious geopolitical crisis in history, which includes a price cap on Russian oil and deferral of climate-change commitments.

The agenda reveals how the world is being turned upside down since the last meeting of leaders of industrialized countries in Cornwall one year ago. It was primarily to discuss the threat posed China.

Boris Johnson warned that the west should not show war fatigue prior to the summit in Germany. This warning will be repeated by Volodymyr Zilenskiy, the Ukrainian president, when he addresses the meeting via videolink. He is expected highlight the difficulties his troops in eastern Ukraine, as well as the need to acquire heavier long-range weapons.

Andriy Yermak, the head of Zelenskiy’s office, saidThe G7 should respond to the latest air strike on Kyiv that killed one person Sunday with a full gas embargo.

The G7 meeting’s three-day conclusion will show that sanctions are slowly working to degrade Russia’s war machine. They will be stepped up if there is no damage to the wider global economy.

Joe Biden, the US president, encouraged the G7 to show determination as he welcomed Olaf Scholz, the German chancellor. “We have to stay together, because Putin has been counting on from the beginning that somehow Nato and the G7 would splinter. But we haven’t and we’re not going to.”

One measure of solidarity with Ukraine will be a ban on new Russian gold imports. However, the idea of a cap to Russian oil prices, backed Biden, has made its way into the discussions as a visible method of slowing rampant inflation, one of the main topics of conversation when G7 leaders gathered over three days in Bavarian Alps.

This price mechanism would establish a maximum oil import limit from Russia. It would be unilaterally imposed by each country and would prevent Russia selling at higher prices. It is also considered a way to reduce inflation due to rising energy prices.

Some European countries are wary of the possibility that this could lead to the painful reopening the existing European Union agreement regarding oil sanctions against Russia. All 27 EU member countries would have to agree. Although the EU plans to eliminate its dependence on Russian oil by year’s end, there were some exceptions. However, this deal was subject to lengthy discussions.

It is not clear how important buyers of Russian crude oil, such China and India could be coaxed into paying a price cap. The US has proposed that shipping insurance for oil cargo would be made conditional on the US paying less than the agreed fixed price for oil onboard. The EU has already banned insurance for the transportation and storage of crude oil and petroleum products from Russia.

Italy has been pushing for a cap to gas prices since weeks. This idea was supported by Italian energy firms. French officials at summit expressed willingness to discuss an oil prices cap, but suggested Europe required a larger energy price shield in order to control inflation.

Vladimir Putin could respond to this by cutting down on gas supplies, but there is no guarantee. Gazprom reduced gas supplies by 60% last Wednesday, citing maintenance issues caused by a lack of parts from Canada. This explanation is not believed to be credible by G7 leaders. The Nord Stream 1 pipeline will be shut down for two weeks of summer maintenance in July. There are fears that Putin might be willing to take the hit to Russian revenues and Gazprom revenues if he believes it will cause an industrial meltdown throughout Europe.

EU states will have to replenish their reserves to 80% by November to prepare for a difficult winter. However, there are complex duties to distribute national reserves to countries that are experiencing energy shortages.

Some EU states allow some coal plants in their countries to stay open for longer than planned. Draft communique reflects a shift in approach to fossil fuels, including gas. It is less rigid about the need for ending all future fossil fuel investments but it is still formulated in a way that retains commitments towards a radical greener energy transition.

This year’s chair of the G7, the German chancellor, Olaf Scholz, has invited as partner countries Senegal, currently chairing the African Union; Argentina, which is heading the Community of Latin American and Caribbean States; Indonesia and India, the current and next hosts of the G20 group of large industrial nations; and South Africa. Joko Widodo of Indonesia announced that he was joining the long list of mediators involved in the Ukraine conflict. travelMoscow to propose a ceasefire

African leaders will be concerned about drought and rising wheat prices and want to know what is being done in order to speed up the flow of grain from Ukraine. However, discussions about a safe route to transport grain convoys from the Ukrainian-run Black Sea port Odesa are difficult. The EU has insisted it is not imposing sanctions on Russian grain or fertiliser exports, and no block on Ukrainian exports would exist but for Russia’s action.

Scholz said: “The summit must send not only the message that Nato and the G7 are more united than ever, but also that the democracies of the world stand together against Putin’s imperialism just as they do in the fight against hunger and poverty.”

The summit is taking place at the castle resort of Schloss Elmau at the foot of Germany’s highest mountain, the Zugspitze – the same venue where the country last hosted the annual G7 meet-up in 2015. This meeting was chaired in 2015 by Angela Merkel, following the first Russian invasion of Ukraine. Merkel is now believed to have left a legacy of dependence on Russian energy.