US Gives Sanctioned Russian Energy Giant Temporary Reprieve As it Looks to Sell Its International Assets

Washington has extended the deadline for the sale of Russian energy giant Lukoil’s global operations until January as the firm looks for buyers after being hit with US sanctions.

A document published by the US Treasury Department on Wednesday said companies can continue to conduct business with Lukoil until shortly after midnight on January 17 next year, but stressed that the extension does not allow “the transfer of funds to any person or account” located in Russia. 

President Donald Trump leveled sanctions against the privately-owned Lukoil and Russia’s state-backed oil producer Rosneft in October after delaying for months amid the US leader’s hopes that a resolution to the war in Ukraine could be reached through diplomacy. 

Lukoil entered into negotiations to sell its overseas assets shortly thereafter, with several US companies showing interest in an acquisition, Reuters reported. According to the outlet, Lukoil had requested the deadline extension to give it more time to arrange a deal. 

Last week, the US Treasury published an exemption from sanctions for certain transactions involving Lukoil retail service stations located outside of Russia until April 29 next year. The UK has also granted a reprieve until late February for companies doing business with an Austria-based Lukoil subsidiary. 

A report by Bloomberg last month found that sanctions by Washington, the UK and the EU have had an impact on the Russian energy sector, with China sharply reducing its imports of Russian oil as a result. 

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