The US Treasury Department has announced that the latest sanctions imposed on Russia’s major state-linked oil companies, Rosneft and Lukoil, are already delivering a noticeable blow to Moscow’s finances. According to an internal assessment by the Office of Foreign Assets Control (OFAC), the measures introduced on October 22 have driven down the selling price of Russian crude and are expected to curb the overall volume of Russian oil entering global markets over time. Washington argues that this directly weakens Russia’s capacity to fund its military campaign in Ukraine.
These sanctions represent one of the most forceful financial actions taken against Russia since its full-scale invasion in February 2022, and they are also the first major penalties aimed directly at Russia’s oil sector under President Donald Trump. Companies worldwide have been given until November 21 to halt all transactions with Rosneft and Lukoil or risk being excluded from the US dollar-dominated financial system.
A major challenge, however, lies in managing the reaction of Russia’s largest customers—China and India, which collectively purchase a significant share of Russian crude. Despite uncertainty over enforcement, OFAC noted that several leading refiners in both countries have already signaled plans to stop buying Russian oil for December shipments, a shift that has pushed Russian crude prices to their lowest levels in more than a year.
Data from LSEG shows Russia’s Urals grade loaded from Novorossiysk trading around $45 per barrel, far below the global Brent benchmark at roughly $64, reflecting widening discounts driven by sanctions pressure and reduced demand. Although loading operations at the port briefly resumed after a Ukrainian drone attack, sales remain weak.
US officials say these trends demonstrate that the sanctions are “starving Putin’s war machine,” and they have warned that Washington is prepared to enact additional measures if Moscow continues its assault on Ukraine.
