G7 leaders pledge to hurt Russia economically as they wrap up summit

Leaders of the world’s wealthiest democracies have struck a united stance to support Ukraine for "as long as it takes" as Russia’s attack grinds on, and said they would explore far-reaching steps to cap Kremlin income from oil sales that are financing the attacks.

The final statement on Tuesday from the Group of Seven summit in Germany underlined their intent to impose "severe and immediate economic costs" on Russia. 

Energy themes were front and centre at the summit throughout. 

It left out key details on how the fossil fuel price caps would work in practice, setting up more discussion in the weeks ahead to "explore" measures to bar imports of Russian oil above a certain level.

That would hit a key Russian source of income and, in theory, help relieve the energy price spikes and inflation afflicting the global economy as a result of the conflict.

“We remain steadfast in our commitment to our unprecedented coordination on sanctions for as long as necessary, acting in unison at every stage," the leaders said.

Details on how the proposal would be implemented were left for continuing talks in coming weeks.

READ MORE: G7 members seek to cap Russian oil price — German official

EU to ban 90% of Russian oil

The US has already blocked Russian oil imports, which were small in any case. 

The European Union has decided to impose a ban on the 90 percent of Russian oil that comes by sea, but that does not take effect until the end of the year, meaning Europe continues to send money to Russia for energy even while condemning the attack. 

Meanwhile, higher global oil prices have softened the blow to Russia's income, even as Western traders shun Russian oil.

Leaders also agreed on a ban on imports of Russian gold and to step up aid to countries hit with food shortages by the blockade on Ukraine grain shipments through the Black Sea.
READ MORE: G7 nations to ban Russian gold imports in response to Ukraine conflict: US

Climate club

Members of the Group of Seven major economies also pledged to create a new "climate club" for nations that want to take more ambitious action to tackle global warming.

The move, championed by Scholz, will see countries that join the club agree on tougher measures to reduce greenhouse gas emissions with the aim of keeping global temperatures from rising more than 1.5 Celsius this century compared with pre-industrial times.

Countries that are part of the club will try to harmonise their measures in such a way that they are comparable and avoid members imposing climate-related tariffs on each others’ imports.

Speaking at the end of the three-day summit in Elmau, Germany, Scholz said the aim was to “ensure that protecting the climate is a competitive advantage, not a disadvantage.”

He said details of the planned climate club would be finalised this year.

READ MORE: G7 leaders vow to stand with Ukraine 'for as long as it takes'