UK sanctions against Transneft and further Russian sanctions developments

On 24th February, 2026, marking the fourth anniversary of the Russia/Ukraine conflict, the UK announced a significant new package of sanctions, including 300 new designations. These measures included the designation of the Russian state-controlled pipeline operator PJSC Transneft (“Transneft”).

At present, the UK position is more restrictive than that of the EU, creating potential complexities for Members whose operations may be lawful under EU sanctions, but whose insurance arrangements involve a UK nexus.

The same UK sanctions package also targeted a network of entities associated with Tahir Garayev and the Coral Energy Group (now 2Rivers Group), described by the UK authorities as a major participant in Russian crude oil trading and the shadow fleet. A number of additional Russian shadow fleet oil and LNG tankers were also designated.

Designation of Transneft

In its accompanying press release, the UK Government described Transneft as one of the world’s largest oil pipeline operators, responsible for transporting over 80% of Russian oil exports.

As a result of Transneft’s designation, an asset freeze applies from 24th February, 2026, meaning that UK persons are prohibited from dealing with Transneft directly or indirectly, including by making funds or other economic resources available to it. Two General Licences issued by the UK’s Office of Financial Sanctions Implementation (“OFSI”), explained further below, provide for a limited wind‑down period until 9th April, 2026 and certain exceptions for Kazakh oil.

The designation is particularly significant because Transneft is understood to own and operate certain Russian ports, including Primorsk, Novorossiysk Commercial Sea Port, and Kozmino. Transneft is also understood to hold minority interests in certain other facilities (including Ust‑Luga and the CPC terminal at Novorossiysk), although those minority interests are not, of themselves, considered sufficient to trigger asset‑freeze implications by virtue of the UK’s ‘owned or controlled’ criteria.

First General Licence - the wind‑down period

Although the asset freeze took effect immediately on 24th February, 2026, the first OFSI General Licence permits the wind‑down or divestment of transactions involving Transneft until 9th April, 2026, subject to its terms and conditions.

This raises the question as to what transactions fall within the scope of the General Licence and how UK insurance is implicated. It is presently understood that to benefit from the General Licence, there should be a pre‑existing cargo sale contract entered into before 24th February 2026, and that any interaction with Transneft (including port services at their owned ports) should be fully closed out by 9th April, 2026. However, further guidance from OFSI may be forthcoming particularly regarding how UK insurers can respond to claims involving Transneft.

Second General Licence - Kazakh oil

On 19th March, 2026 OFSI issued a further General Licence permitting certain transactions with Transneft in relation to maritime services for the transport of Kazakh oil. This licence expires on 18th March, 2028.

Interaction with EU sanctions

As matters currently stand, the EU has not designated Transneft to the same extent as the UK, and certain dealings may remain permissible under the EU sanctions, for example, where they fall within the scope of the oil price cap regime.

However, as mentioned above, Members should be mindful that UK based insurers may still be unable to respond where UK sanctions are engaged, even if the underlying trade is permitted under EU sanctions.

EU regulations require notifications to be made by Members when calling at certain Russian ports namely Primorsk, Ust-Luga, Novorossiysk, Astrakhan and Makhachkala.

United States sanctions – temporary easing for Russian oil already at sea

In contrast to the UK and EU position, the United States has recently taken a more liberal albeit temporary approach to Russian sanctions in response to volatility in global energy markets caused by the war with Iran.

On 12th March, 2026, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued Russia related General License 134, which temporarily authorises the sale, delivery and offloading of Russian origin crude oil and petroleum products that were already loaded on ships on or before 12th March, 2026. The Licence remains in force until 11th April, 2026.

The EU and UK have not aligned with this US approach, however, such that all UK and EU sanctions targeting Russian oil and refined petroleum products remain in place.

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