Russia slams sanctions on Gazprom and energy entities as ‘desperate’
Russia has dismissed tough new US sanctions targeting its energy sector as a desperate move by an outgoing administration, vowing the measures would not derail its oil and gas industry or its position as a ‘key and reliable player in the global fuel market’.
Russia’s foreign ministry said on 11 January that Washington’s ‘hostile actions will not go unanswered,’ characterising the sanctions as an attempt to ‘inflict damage on the Russian economy at any cost, even at the risk of destabilising global markets.’
The statement came in response to extensive US sanctions coordinated with action by the United Kingdom and announced on 10 January.
The US measures targeted more than 200 entities and individuals, among them two major Russian oil producers. More than 180 vessels and dozens of shipping companies were also sanctioned in what Treasury Secretary Janet Yellen called an effort to disrupt ‘Russia’s key source of revenue for funding its brutal and illegal war against Ukraine.’
‘Today, the United States imposed the most significant sanctions yet on Russia’s energy sector, by far the largest source of revenue for Putin’s war,’ the White House said in a statement.
Treasury’s measures include blocking sanctions on oil giants Gazprom Neft and Surgutneftegas, along with more than two dozen subsidiaries, including Gazpromneft Moscow Refinery, Gazprom Neft Shelf, and Surgutneftegas subsidiaries Kaliningradnefteprodukt OOO and KINEF OOO.
The United Kingdom joined the US in sanctioning the two oil giants, with the UK Foreign Commonwealth and Development Office noting this represented the ‘first time the UK and the US are directly sanctioning Gazprom Neft and PJSC Surgutneftegas.’
Moscow has accused the Biden administration of sacrificing both the interests of European allies, ‘who are being forced to switch to more expensive and less reliable American supplies,’ and those of US citizens facing high fuel prices and wildfire damage in California.
The sanctions designated 183 vessels, primarily oil tankers that US officials say are part of a ‘shadow fleet’ used to evade restrictions. These included 69 vessels owned by state shipping company Sovcomflot, such as the crude oil tankers Kirill Lavrov and Mikhail Ulyanov, along with vessels managed by UAE-based firms Fornax Ship Management FZCO and Stream Ship Management FZCO which Treasury said ‘support Sovcomflot’.
Meanwhile, the State Department targeted operators of major liquefied natural gas (‘LNG’) projects, including Gazprom SPG Portovaya and Cryogas Vysotsk, which run LNG export terminals. It also designated Limited Liability Company Vostok Oil, operator of a major development project that aims to export up to two million barrels of oil daily, along with its subsidiary Tagulskoe.
In addition, Treasury targeted what it called ‘opaque traders’ of Russian oil, including UAE-based Black Pearl Energy Trading LLC, which has allegedly sold more than $2 billion worth of Russian crude oil since 2023. The company reportedly has connections to the Russian government through former energy ministry official Denis Olegovich Deryushkin and the state-owned Aktsionernoe Obshchestvo Tsentr Ekspluatatsionnykh Uslug.
Treasury has also sanctioned two Russia-based maritime firms, Ingosstrakh Insurance Company and Alfastrakhovanie Group, which have insured tankers transporting Russian petroleum products.
Meanwhile, the Treasury’s Office of Foreign Assets Control (‘OFAC’) issued eight new general licences related to the new measures, including provisions for winding down energy-related transactions through 12 March 2025, and transactions involving existing civil nuclear energy projects. Other licences cover wind-down periods for dealings with newly sanctioned entities Gazprom Neft and Surgutneftegas, their debt and equity transactions, diplomatic mission operations, and safety-related activities involving blocked vessels.
OFAC also revoked a previous licence authorising transactions with certain Sovcomflot vessels and issued five new FAQs while amending 14 others to provide guidance on the new measures.
The State Department’s actions were directed against 14 senior officials of Russia’s state nuclear company Rosatom, including CEO Alexey Likhachev and First Deputy Director General for Nuclear Energy Alexander Lokshin, citing the company’s involvement in weapons development and Russia’s war effort in Ukraine.
The foreign ministry in Moscow remained defiant in the face of the largest US sanctions action against Russian oil, countering that Russia ‘has not only withstood these efforts but continues to develop.’ It said major domestic projects for oil and gas extraction would proceed as planned, dismissing the US measures as part of a ‘scorched earth policy’ by the outgoing Biden administration.
