The proposed price cap on Russian oil is a “ridiculous idea” that could backfire on the U.S. and the other Group of 7 countries, according to the co-director of the Institute for the Analysis of Global Security.
“It’s kind of a ridiculous idea in my view,” Gal Luft told CNBC’s “Squawk Box Asia” on Monday.
“It ignores the fact that oil is a fungible commodity,” he said. The term fungible means interchangeable, implying equal value between two barrels of oil, for example.
The U.S. wants to put a cap on Russia’s oil prices to reduce funds flowing into the the country’s war chest, while also bringing down the cost of oil for consumers.
Luft likened the plan to going to a shop and asking the…