U.S. imposes sanctions on Russia’s largest oil companies to pressure ceasefire in Ukraine
Date of publication: October 23, 2025
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced sweeping sanctions targeting Russia’s two largest oil companies - Rosneft and Lukoil, along with their subsidiaries, to disrupt the Russia’s revenue streams fuelling its ongoing war in Ukraine.
The measures reflect the U.S. commitment to pressuring Russia for a ceasefire and a peaceful resolution.
Sanctions overview
The sanctions package specifically targets Russia’s energy sector, by adding the following to the Specially Designated Nationals (SDN) List:
Open Joint Stock Company Rosneft Oil Company (Rosneft)
: A vertically integrated energy giant involved in exploration, production, refining, and distribution of petroleum, natural gas, and related products.Lukoil OAO (Lukoil)
: A major player in oil and gas exploration, production, refining, and marketing, both in Russia and internationally.Multiple Subsidiaries
: Over 30 Russia-based subsidiaries of Rosneft and Lukoil, involved in oil and gas production, refining, and technological development for hydrocarbon extraction. Notable subsidiaries include:
- Lukoil Perm, Lukoil West Siberia Limited, and Lukoil Kaliningradmorneft for oil and gas production.
- Rosneft’s RN Yuganskneftegaz, RN Uvatneftegaz, and Samaraneftegaz for oil and gas field development.
- Rosneft’s Ryazan Oil Refinery Company and Saratov Oil Refinery for refining operations.
Under Executive Order (E.O.) 14024, all entities owned 50 percent or more, directly or indirectly, by Rosneft or Lukoil are also blocked, even if not explicitly listed by OFAC.
Additionally, foreign financial institutions engaging in significant transactions with these entities risk secondary sanctions, including restrictions on U.S.- based correspondent or payable-through accounts.
Compliance risks
Unless authorized by a general or specific license issued by OFAC, or exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of blocked persons.
Violations of U.S. sanctions may result in the imposition of civil or criminal penalties on U.S. and foreign persons. OFAC may impose civil penalties for sanctions violations on a strict liability basis. OFAC’s Economic Sanctions Enforcement Guidelines provide more information regarding OFAC’s enforcement of U.S. economic sanctions.
In addition, financial institutions and other persons may risk exposure to sanctions for engaging in certain transactions or activities with designated or otherwise blocked persons. 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.
Any persons included on the SDN List pursuant to E.O. 14024 may be subject to additional export restrictions administered by the Department of Commerce, Bureau of Industry and Security (BIS).
Conclusion
The U.S. sanctions on Rosneft, Lukoil, and their subsidiaries mark a significant escalation in efforts to cripple Russia’s energy sector and pressure Moscow into a ceasefire in Ukraine.
Companies globally, particularly those in energy, finance, and trade, should review their exposure to these sanctioned entities and their supply chains.
These changes have been updated in ONESOURCE Global Trade Content.
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