The United States Treasury Department has imposed sanctions on two of Russia’s largest energy companies, Rosneft and Lukoil, along with multiple subsidiaries, in an effort to cut off revenue streams that support Russia’s war in Ukraine. The move, announced on October 22, 2025, adds the companies to the Specially Designated Nationals and Blocked Persons (SDN) List, barring U.S. persons from engaging in any business with them.

Under the sanctions, U.S. entities must also freeze any assets owned or controlled by the designated firms. OFAC’s “50% Rule” extends the restrictions to any company that is 50% or more owned, directly or indirectly, by the blocked entities.

To manage the transition, OFAC issued four general licenses allowing limited transactions with the sanctioned companies until November 21, 2025. These licenses cover winding down ongoing deals, handling certain debt and equity contracts, maintaining Lukoil retail stations outside Russia, and conducting petroleum services related to the Caspian Pipeline Consortium and Tengizchevroil projects.

The sanctions affect a wide array of subsidiaries, including Lukoil Perm, Bashneft Dobycha, RN Purneftegaz, Sibneftegaz, and multiple refineries and regional oil and gas companies under Rosneft and Lukoil.

Experts warn that the move could have major repercussions for global energy markets, potentially affecting oil supply chains and pricing worldwide. The sanctions are part of the U.S. strategy under Executive Order 14024, designed to pressure Russia by targeting key sectors of its economy, including energy, and limiting funding for military operations.

OFAC emphasized that violations of these sanctions could result in severe penalties, reinforcing the global reach and seriousness of the U.S. measures.