October, 2025: Sanctions against Russia: UK, US and EU introduce further sanctions targeting the Russian energy sector

There have been a number of significant sanctions imposed against Russia recently, with certain (but not complete) co-ordination between the UK, US and EU:

UK and US sanctions against Rosneft and Lukoil

On 15th October, 2025 the UK announced its “strongest sanctions yet on Russia”. These include the following key measures:

• Designating the Russian oil majors Rosneft and Lukoil. These designations also affect companies owned or controlled by these oil majors. That followed the UK’s previous designations of Russian oil majors, Gazprom Neft and Surgutneftegas. OFSI General Licences are available, allowing a winding down period for existing transactions with Rosneft and Lukoil until 28th November, 2025.
• Introducing a ban on imports of oil products refined in third countries from Russian-origin crude oil (following the EU’s ban of the same in its 18th package of sanctions).
• Sanctioning 7 LNG tankers and the Chinese Beihai LNG terminal, for importing LNG from Arctic LNG2 (the designated Russian LNG project).
• Sanctioning 4 oil terminals in China, a further 44 ships in the shadow fleet of tankers, and India’s Nayara Energy Limited (also sanctioned by the EU in its 18th package for being partly owned by Rosneft and a major refiner of Russian crude oil).

On 22nd October, 2025, the US announced its own designations of Rosneft and Lukoil, marking the first time this Trump administration has imposed sanctions against Russia. Rosneft and Lukoil were designated pursuant to E.O. 14024 for operating or having operated in the energy sector of the Russian Federation’s economy.

OFAC also designated a number of Russian based Rosneft and Lukoil subsidiaries. Moreover, all entities owned 50 percent or more, directly or indirectly, by Rosneft and Lukoil are blocked pursuant to E.O. 14024, even if not designated by OFAC.

An OFAC General License is available authorising the wind down of transactions involving Rosneft or Lukoil to 21st November, 2025, earlier than the end of the UK’s wind down period.

US sanctions are generally seen as more powerful and having a further reach than other EU/UK sanctions. The US has clarified that “foreign financial institutions that conduct or facilitate significant transactions or provide any service involving Russia’s military-industrial base, including any persons blocked pursuant to E.O. 14024, run the risk of being sanctioned by OFAC.”

There is also a risk of extraterritorial secondary sanctions to penalise non-US entities that may engage with Rosneft or Lukoil: “OFAC can prohibit or impose strict conditions on opening or maintaining, in the United States, a correspondent account or a payable-through account of a foreign financial institution that knowingly conducts or facilitates any significant transaction on behalf of a person who is designated pursuant to the relevant authority.”

It has been reported in several press articles that India’s and China’s largest refineries are looking at curbing imports of Russian oil as a result of the US measures.

EU’s 19th package of sanctions

On 23rd October, 2025, the EU adopted its 19th package of sanctions against Russia, including the following key energy sector measures:

• A ban on the purchase, import or transfer, directly or indirectly, of Russian LNG: a) starting in January, 2027 for long-term contracts (i.e. those exceeding 1 year and concluded before 17th June, 2025); and b) from 25th April, 2026, for short-term contracts.
• Expanding the transaction ban on Rosneft and Gazprom Neft; unlike the UK and US measures, the EU has not (yet) designated Lukoil, although its Dubai based subsidiary, Litasco Middle East DMCC has now been sanctioned. The new measures eliminate the exemption for Rosneft’s and Gazprom Neft’s oil and gas imports into the EU.
• Targeting third country operators for enabling Russia’s revenue streams, including two Chinese refineries and an oil trader that are significant buyers of Russian crude oil.
• An import ban on a variant of liquified petroleum gas (reportedly used to bypass existing LPG restrictions).
• Listing Litasco Middle East DMCC (designated in the UK since July, 2025), for being Lukoil’s shadow fleet enabler based in the UAE. It had previously listed Litasco’s Dubai-based shipping subsidiary, Eiger Shipping DMCC, in the 17th package.
• Designating maritime registries for providing false flags to shadow fleet ships.
• Extending the port infrastructure ban to enable the EU to list ports in third countries other than Russia that are instrumental to the Russian war effort, or for the circumvention of the oil price cap by ships practising irregular and high-risk shipping practices, or other restrictive measures.
• An additional 117 ship have been made subject to a port access ban and a ban on the provision of a broad range of services, bringing the total number of designated ships to 557.
• A ban on reinsuring ships belonging to the shadow fleet.

Further information can be found here:

https://www.gov.uk/government/news/huge-blow-for-putins-war-machine-as-uk-sanctions-russian-oil

Treasury Sanctions Major Russian Oil Companies, Calls on Moscow to Immediately Agree to Ceasefire | U.S. Department of the Treasury

19th package of sanctions against Russia: EU targets Russian energy, third-country banks and crypto providers - Consilium

EU adopts new sanctions against Russia - European Commission

If Members have any questions in relation to the above issues they are invited to contact the Club for further information.