Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said the impact of European sanctions on Russian crude oil and the cap that the Group of Seven nations have imposed on the price of Russian barrels is not clear yet. 

“In terms of sanctions and price caps, these have not yielded clear results yet,” the prince told a forum in Riyadh on Sunday, held following the country’s 2023 budget announcements last week. 

“Some of these measures were only implemented on Dec. 5 and we can now see the state of uncertainty in the implementation. There are many measures that have not been verified and it will continue to change or be modified in line with the political requirements.”

The G-7 last week slapped a price ceiling on Moscow’s oil exports, a move that Washington insists is purely about Russia: keeping its oil flowing while starving it of funds for the war in Ukraine. Introduced in tandem with a European Union ban on seaborne Russian crude, any nations still buying must pay $60 a barrel or less or lose access to key shipping services supplied by EU and G-7 firms.

OPEC+ — a 23-nation coalition that is led by Saudi Arabia and Russia — met to discuss policy earlier this month and agreed to hold output steady, having decided in October to cut supply by two million barrels a day in a move that angered the US. 

Oil soared after Russia sent troops into Ukraine in February, with benchmark Brent topping $127 a barrel. But it’s since slumped below $80 as slowing economic growth in the US and Europe, and lingering coronavirus curbs in China, stoke demand concerns. Adding to that weakness is a view among traders that the price cap was set high enough to ensure Russia won’t need to rein in output.

Despite this, Russian president Vladimir Putin said his country may cut its oil production in response to the price cap and that a decision on Russia’s response will be made within the next several days, according to comments broadcast on state Rossiya 24 TV on Dec. 9. 

Asked about the threat to cut oil production by Russia, the prince told reporters today: “I’ll believe it when I see it.”

Russia’s response to the price cap also adds another layer to the uncertainty surrounding the actual impact the measures could have on global markets, the Saudi energy minister told the forum. 

“What will the reaction be, what they can possibly do and whether it will be similar to what has been done with gas, will the practices when it comes to crude oil be similar or different, is also mysterious,” he said. “These tools were created for political purposes, and it is not clear yet whether they can achieve these political purposes. “

Other uncertainties on the global economy as we walk into 2023 include the impact on the Chinese economy from easing Covid restrictions and central banks’ actions to tame inflation.

“The central banks now are controlled by the tendencies to curb inflation no matter the costs – these will have negative impacts on the growth of global economies.” he said.

The OPEC+ alliance decision to cut production by two million barrels a day on Oct. 5 was proven to be the correct one when recent developments are taken into consideration, he said, adding that the alliance will continue to focus on stability in the year ahead. 

“OPEC+ is working under a sole economic mechanism and perspective. We don’t go into politics; we don’t go into alliances and we don’t have the intention to do so in the future.”