Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control has imposed further sanctions as a result of Russia’s lack of serious commitment to a peace process to end the war in Ukraine.
The actions pressure Russia’s energy sector and degrade the Kremlin’s ability to raise revenue.
The United States will continue to advocate for a peaceful resolution to the war, and a permanent peace depends entirely on Russia’s willingness to negotiate in good faith. Treasury will continue to use its authorities in support of a peace process.
“Now is the time to stop the killing and for an immediate ceasefire,” Treasury Secretary Scott Bessent said in a statement. “Given President Putin’s refusal to end this senseless war, Treasury is sanctioning Russia’s two largest oil companies that fund the Kremlin’s war machine. Treasury is prepared to take further action if necessary to support President Trump’s effort to end yet another war. We encourage our allies to join us in and adhere to these sanctions.”
The sanctions target Russia’s two largest oil companies, Open Joint Stock Company Rosneft Oil Company and Lukoil OAO. Rosneft is a vertically integrated energy company specializing in the exploration, extraction, production, refining, transport, and sale of petroleum, natural gas, and petroleum products. Lukoil engages in the exploration, production, refining, marketing, and distribution of oil and gas in Russia and internationally.
Rosneft and Lukoil are being designated pursuant to E.O. 14024 for operating or having operated in the energy sector of the Russian Federation economy.
Additionally, OFAC is designating many Russia-based Rosneft and Lukoil subsidiaries. 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.
The sanctions block all property and interests in property of the designated or blocked persons described above that are in the United States or in the possession or control of U.S. persons and must be reported to OFAC.
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.
In addition, 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.
Furthermore, engaging in certain transactions involving the persons designated today may risk the imposition of secondary sanctions on participating foreign financial institutions. 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.
The power and integrity of OFAC sanctions derive not only from OFAC’s ability to designate and add persons to the SDN List, but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, or to submit a request, please refer to OFAC’s guidance on Filing a Petition for Removal from an OFAC List.
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.