ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon Print
International relations

Biden urges G-7 to stay together as leaders target Russian gold, oil price

Agenda dominated by war in Ukraine and its impact on food and energy supplies

SCHLOSS ELMAU, Germany (Reuters) -- U.S. President Joe Biden told allies "we have to stay together" against Russia on Sunday as G-7 leaders gathered for a summit dominated by war in Ukraine and its impact on food and energy supplies and the global economy.

At the start of the meeting in the Bavarian Alps, four of the Group of Seven rich nations moved to ban imports of Russian gold to tighten the sanctions squeeze on Moscow and cut off its means of financing the invasion of Ukraine.

But it was not clear whether there was G-7 consensus on the plan, with European Council President Charles Michel saying the issue would need to be handled carefully and discussed further.

Britain, the U.S., Japan and Canada agreed the ban on new Russian gold imports, the British government said on Sunday.

Britain said the ban was aimed at wealthy Russians who have been buying safe-haven bullion to reduce the financial impact of Western sanctions. Russian gold exports were worth $15.5 billion last year.

The G-7 leaders of Britain, France, the U.S., Germany, Japan, Italy and Canada, were also having "really constructive" talks on a possible price cap on Russian oil, a German government source said.

A French presidency official said Paris would push for a price cap on oil and gas and was open to discussing a U.S. proposal.

The G-7 leaders did agree on a pledge to raise $600 billion in private and public funds for developing countries to counter China's growing influence and soften the impact soaring food and energy prices.

G-7 host German Chancellor Olaf Scholz invited Senegal, Argentina, Indonesia, India and South Africa as partner nations at the summit. Many countries of the global south are concerned about the collateral damage from Western sanctions on Russia.

Oxfam and other campaign groups said the pain from food price spikes for developing countries was "visceral."

They want G-7 leaders to tax excessive corporate profits to help those hit by the food crisis, cancel debts of the poorest nations and to support developing countries in their battle against the food crisis and climate change.

An EU official said G-7 countries would impress upon the partner countries that food price rises were the result of Russia's actions, not Western sanctions.

Officials from some G-7 countries, including Germany and Britain, are pushing for temporary waivers on biofuels mandates to combat soaring food prices, according to sources familiar with the matter.

But Germany expects the proposal to fail to secure G-7 backing due to U.S. and Canadian resistance, a government official told Reuters on Sunday.

Western countries rallied around Kyiv when Russia invaded Ukraine in February, but more than four months into the war, that unity is being tested as soaring inflation and energy shortages rebound on their own citizens.

At the start of a bilateral meeting, Biden thanked Scholz for showing leadership on Ukraine and said Russian President Vladimir Putin had failed to break their unity.

"Putin has been counting on it from the beginning that somehow the NATO and the G-7 would splinter. But we haven't and we're not going to," Biden said.

The summit provides an opportunity for Scholz to demonstrate more assertive leadership on the Ukraine crisis.

He vowed a revolution in German foreign and defense policy after Russia's invasion in February, but critics have since accused him of dragging his feet.

As missiles struck the Ukrainian capital Kyiv on Sunday, hitting an apartment block and a kindergarten, Foreign Minister Dmytro Kuleba said the G-7 must respond with more weapons and tougher sanctions on Russia.

Biden called the strikes acts of "barbarism."

The G-7 leaders are also expected to discuss options for tackling rising energy prices and replacing Russian oil and gas imports, as well as further sanctions that do not exacerbate the cost-of-living crisis affecting their own populations.

Soaring global energy and food prices are hitting economic growth in the wake of the conflict in Ukraine, with the United Nations warning of an "unprecedented global hunger crisis."

Climate change is also set to be on the G-7 agenda.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Discover the all new Nikkei Asia app

  • Take your reading anywhere with offline reading functions
  • Never miss a story with breaking news alerts
  • Customize your reading experience

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more