As Russian Energy Week concluded last week, Western governments strike to the heart of Russia’s energy sector with sanctions packages to cut of revenue that funds Russia’s continued war against Ukraine. Three significant packages were announced in October 2025: the U.S.’s sanctions targeting the Russian energy sector, the UK’s latest sanctions against the Russian oil industry, and the EU’s 19ᵗʰ package of sanctions.
U.S. Measures
On October 22, 2025, in a significant escalation aimed at pressuring Russia to cease hostilities in Ukraine, the Trump Administration announced new sanctions targeting two of Russia’s largest oil companies: Open Joint Stock Company Rosneft Oil Company (“Rosneft”) and Lukoil OAO (“Lukoil”), as well as certain subsidiaries. All are now designated as specially designated nationals (SDNs) pursuant to Executive Order 14024 for their operations in the energy sector of the Russian Federation.
This action marks the first direct sanctions relating to Russia in the second Trump Administration, representing a major shift in U.S. policy and sanction strategy.
Critically, any foreign financial institution that conducts or facilitates significant transactions with Rosneft, Lukoil, or their designated subsidiaries are also exposed to the risk of U.S. sanctions.
Looking ahead, the Trump Administration could also further impose secondary sanctions in the Rosneft and Lukoil oil supply chain by targeting foreign banks in China or refineries in India that process or purchase Russian oil.
Already, the Trump Administration has imposed a 25% tariff on Indian goods due to India buying Russian oil. We have also seen a “maximum pressure” campaign of sanctions used against the Iranian oil sector, where the Trump Administration targeted not only Iranian producers but also foreign parties who helped facilitate that trade. The current measures may signal further intensification against Russian energy interests and any foreign entities that enable their operations.
Relatedly, the Treasury's Office of Foreign Assets Control (OFAC) also issued the following general licenses:
| License | Summary | Expiration |
| GL 124A | Authorizes petroleum services & other transactions related to Caspian Pipeline Consortium & Tengizchevroil projects | Ongoing exemption |
| GL 126 | Authorizes the wind-down of transactions involving Rosneft or Lukoil | Nov 21, 2025 |
| GL 127 | Authorizes certain transactions related to debt/equity/derivatives of Rosneft or Lukoil | Nov 21, 2025 |
| GL 128 | Authorizes certain transactions involving Lukoil retail service stations located outside Russia | Nov 21, 2025 |
Transactions related to Caspian Pipeline Consortium and Tengizchevroil Projects remain exempt from these new restrictions beyond the wind-down period.
UK Measures
On October 15, 2025, the UK Government announced a package of ninety new sanctions that, as Chancellor Rachel Reeves stated, are intended to take Russian oil off the market. Specifically, the UK sanctions package is directed at Russian oil and its infrastructure and designates Rosneft and Lukoil in an attempt to cut off funding for Russia’s military operations. As Russia’s largest oil producers[1] and some of the largest energy companies in the world, the companies now face asset freezes, director disqualifications, transport restrictions, and a ban on UK trust services.
The UK sanctions also target Russia’s oil-trading infrastructure. The package sanctioned four oil terminals in Shandong Province, China; forty-four vessels identified as operating in Russian’s shadow fleet; and Nayara Energy Limited, an Indian refiner that imported $ billion worth of Russian oil in 2024.
In addition, the sanctions package also targets Russian liquid natural gas (LNG). The UK sanctioned seven specialized LNG tankers and the Beihai LNG terminal in China, which imports LNG from the sanctioned Russian flagship Arctic LNG2.
The sanctions also target the Russian military supply chain, designating businesses that supply electronics critical for Russian drones and missiles in Thailand, Singapore, Turkey, and China.
The UK package also includes import restrictions, banning imports of oil products refined in third countries from Russian‑origin crude.
EU Measures
On October 23, 2025, the EU Council announced that it would adopt a 19ᵗʰ package of sanctions containing 69 new individual listings and numerous economic restrictive measures. The package targets sectors that support Russia’s invasion of Ukraine, including its energy, finance, and military‑industrial sector. The EU also moved to restrict the movement of Russian diplomats across the EU and to punish those responsible for the abduction of Ukrainian children.
Targeting Russia’s energy sector, the EU will ban imports of Russian liquefied natural gas (LNG), beginning in 2027 for long-term contract, and within six months for short-term contracts. The EU also expanded its sanctions against Rosneft and Gazprom Neft by eliminating previous exemptions.[2]
The EU sanctions package also targets the infrastructure and supply chain that the Russian energy sector has used to circumvent sanctions. The package targets Russia’s shadow fleet by adding 117 vessels suspected of circumventing price caps to the EU sanctions list. Those vessels face port‑access bans, service prohibitions, and a ban on re‑insurance. The package also sanctions Litasco Middle East DMCC, a shadow‑fleet enabler linked to Lukoil, as well as maritime registries providing false flags. Chinese oil refineries and oil traders were also sanctioned for importing large volumes of Russian crude oil.
With regard to the Russian financial sector, the EU, for the first time, directly targeted cryptocurrency infrastructure. Sanctions apply to the developer of A7A5, a ruble‑backed stablecoin, its Kyrgyz issuer, and the operator of a trading platform where A7A5 is traded. The sanctions package prohibits transactions involving A7A5 throughout the EU. Five Russian banks (Istina, Zemsky Bank, Commercial Bank Absolut Bank, MTS Bank, and Alfa‑Bank) and eight banks and oil traders in Kyrgyzstan and Tajikistan face new transaction bans. The package also prohibits use of Mir, the Russian National Payment Card System and SBP, the Fast Payments System.
The EU also targeted Russia’s military industrial sector with targeted export bans on select entities, expansion of existing export bans on goods and services, and restrictions on entities in Russian Special economic zones (SEZs). The Council identified forty-five entities that would be subject to export restrictions related to dual-use good for supporting the Russian military by circumventing export restrictions. Twenty-eight of those entities are in Russia, twelve are in China, three are in India, and two are in Thailand. The EU extended existing export bans to include electronic components, rangefinders, chemicals used in propellants, metals, oxides and alloys used in weapons manufacture, salts, ores, rubber articles, tubes, tyres, construction materials, and all acyclic hydrocarbons. All services provided to the Russian government now require prior authorization, and the package prohibits EU operators from providing AI services, high‑performance computing services, commercial space‑based services to Russian entities, as well as banning services related to the Russian tourism. Entities active in nine Russian SEZs were added to the EU sanctions list, and investment bans were introduced to restrict future investment in these zones.
Finally, the EU implemented controls on the movement of Russian diplomats and targeted sanctions related to the abduction of Ukrainian children. Russian diplomats travelling across the Schengen area beyond their country of accreditation must provide advance notice to the relevant EU member state. Member states may also impose authorization requirements for Russian diplomatic travel. The EU listed eleven individuals involved in the abduction, forced deportation, forced assimilation and militarization of Ukrainian children.[3] The EU also adopted a new expedited listed criteria for sanctioning parties responsible for the abduction of those children.
Conclusion
The coordinated sanctions underscore a united push by Western governments to increase economic pressure on Russia and secure an end to Russia’s invasion in Ukraine. For the United States, these sanctions come after peace talks with Russia were cancelled by Trump because “they don’t go anywhere.” UK Foreign Secretary Yvette Cooper identified that the UK would continue to pressure Russia until Putin “abandons his failed ware of conquest and gets serious about peace.” The EU’s forthcoming ban on Russian LNG sends a strong message that the EU is willing to decouple from the Russian economy in order to secure Ukrainian sovereignty.
FOOTNOTES
[1] In January 2025, the UK sanctioned Russia’s third and forth largest producers, Gazprom Neft and Surgutneftegas.
[2] The EU has not sanctioned Lukoil.
[3] Ukraine estimates that nearly 20,000 children have been abducted by Russia.