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The Group of Seven leaders will "instruct ministers to work urgently towards developing and consulting with third countries and the private sector in an effort to develop a price ceiling around oil," the senior official told reporters, according to Agence France-Presse.
A formal announcement is expected in the final communique later as the three-day G7 summit in the Bavarian Alps draws to a close.
The United States led the effort to impose a cap on oil prices at the summit, which also includes Britain, Canada, France, Germany, Italy, France, Germany and Japan.
The goal of the plan is to deprive the Kremlin of its "main source of cash and force the price of Russian oil to fall," U.S. President Joe Biden's national security adviser, Jake Sullivan, told reporters at the summit on Monday.
While the West has already imposed multiple levels of sanctions on Russia in response to Putin's order to invade Ukraine in February, the targeting of the oil industry represents the highest economic stakes so far.
The idea is that consuming countries would effectively set a low price for Russian oil, while Moscow, needing the revenue, would have no choice but to accept it.
The plan would also help reduce soaring energy costs, which have fueled global inflation and rekindled fears of a recession.
However, there are significant questions about unity among consumer countries and whether Russia would actually back down or, instead, could retaliate by cutting energy supplies to Europe.
Energy exports are Russia's largest revenue stream, while Western countries are among those heavily dependent on imported oil and gas.
According to Sullivan, the main obstacle to the idea is not so much a willingness to move forward as sorting out the highly complex logistical and technical aspects.
One way allies could impose the cap is to restrict Russian oil exporters' access to financial services or insurance companies unless they can demonstrate compliance with the lower price.
European Council President Charles Michel told the summit on Sunday that the bloc would discuss the proposal but that many obstacles remained.
He said the price cap would require adjusting existing sanctions against Moscow, which would need the support of all 27 member states.
Source: CNA
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