The U.S. Department of the Treasury, through its Office of Foreign Assets Control, has leveled fresh sanctions at Russia’s energy sector to squeeze Kremlin revenue and pressure Moscow toward a negotiated end to the Ukraine war. The move names the country’s two largest oil firms and reaches their subsidiaries and affiliates, blocks property tied to them, and warns foreign banks they risk penalties for doing business with designated entities. The action is framed under E.O. 14024 and is presented as part of a broader push to cut off funding for Russia’s military effort.
Treasury announced designations targeting Open Joint Stock Company Rosneft Oil Company and Lukoil OAO, citing their roles in the Russian energy economy. Rosneft is described as a vertically integrated energy company active across exploration, extraction, production, refining, transport, and sales of petroleum and natural gas. Lukoil operates in exploration, production, refining, marketing, and distribution both inside Russia and in international markets.
The sanctions are framed to degrade the Kremlin’s ability to raise revenue from oil and to make it harder for Moscow to finance the war. OFAC’s designations are being applied pursuant to E.O. 14024 for operating in the energy sector of the Russian Federation economy. Many Russia-based subsidiaries of Rosneft and Lukoil are being designated, and the policy applies the 50 percent ownership rule to block entities owned directly or indirectly by the named companies.
“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 block all property and interests in property of the designated or blocked persons that are in the United States or in the possession or control of U.S. persons, and those assets must be reported to OFAC. The legal framework allows OFAC to list persons on the SDN List and to apply blocking measures that effectively cut designated companies off from the U.S. financial system. That blockage reaches subsidiaries and any entities owned 50 percent or more by the designated companies, even if they are not separately named.
Violations of U.S. sanctions can trigger civil or criminal penalties for both U.S. and foreign persons, and OFAC has the authority to seek civil penalties on a strict liability basis. The Treasury’s enforcement posture is unambiguous: firms and individuals that transact with blocked parties risk significant fines and other sanctions. That strict approach is intended to deter third parties from finding workarounds that would blunt the intended pressure on Russia.
Foreign financial institutions face specific exposures if they conduct or facilitate significant transactions for Russia’s military-industrial base or for persons blocked under E.O. 14024. Participating institutions may face secondary sanctions, including limits on correspondent or payable-through accounts in the United States, or other prohibitions and conditions on U.S. banking ties. The guidance warns that knowingly facilitating significant transactions on behalf of designated parties can bring those banks into OFAC’s crosshairs.
Sanctions policy is presented as a tool to change behavior rather than merely to punish, and OFAC retains the ability to remove persons from the SDN List consistent with law when warranted. The Treasury also notes that entities listed under E.O. 14024 may be subject to additional export controls administered by the Department of Commerce’s Bureau of Industry and Security. Parties that believe they merit reconsideration can follow published OFAC procedures for petitions seeking removal.
Editor’s Note: The Schumer Shutdown is here. Rather than put the American people first, Chuck Schumer and the radical Democrats forced a government shutdown for healthcare for illegals. They own this.
