Sanctions Watch | Weekly Vol. 154

Sanctions Watch Vol 154

In the latest edition of our Sanctions Watch weekly digest, we present significant updates on sanction watchlists and regulatory developments.

UK Issues Indefinite General Trade Licence for Processed Russian Oil Products, Easing Supply Chain Pressure

The UK government has introduced a new General Trade Licence (GBSAN0004) that permits the trade of certain processed oil products derived from Russian crude, offering greater clarity and stability to global energy markets. Published on 19 May 2026 by the Department for Business and Trade, the licence exempts specified processed oil products from key restrictions under the Russia sanctions regime, provided they are refined in third countries before trade.

The licence applies specifically to diesel and jet fuel products classified under designated commodity codes, including diesel products under codes 2710 19 42 and 2710 19 44, and jet fuel under code 2710 19 21. These products must originate from Russian crude oil classified under commodity code 2709 and be processed outside Russia, the UK, and the Isle of Man.

The move is seen as a pragmatic step to maintain fuel supply resilience and minimise disruption across aviation, transportation, and industrial sectors. By allowing continued access to refined products processed through international supply chains, the UK aims to balance sanctions enforcement with economic stability and energy security. The licence comes into force on 20 May 2026 and will remain effective indefinitely, subject to periodic government review.

UK Closes ‘Back Door’ on Russian Oil Imports Through Third Countries

The United Kingdom has introduced tougher sanctions aimed at preventing Russian crude oil from entering the country through third-country refining routes. Under new regulations effective from 20 May 2026, the UK now bans the import of oil products refined in other countries if they were originally produced using Russian crude oil. The move strengthens earlier sanctions imposed after Russia’s invasion of Ukraine and aligns closely with measures already adopted by the European Union.

The updated rules target petroleum products under HS code 2710, including diesel and jet fuel, when they are refined abroad using Russian-origin crude oil. UK authorities said the objective is to close loopholes that previously allowed Russian oil revenues to continue flowing indirectly into global markets.

Importers must now provide clear evidence showing that oil products entering the UK were not produced using Russian crude. The government has also issued detailed guidance on supply-chain compliance, refinery attestations, and enforcement measures. Certain countries, including the EU, Canada, Norway, the USA, Australia, Switzerland, and New Zealand, are exempt from extensive supply-chain checks due to their own sanctions on Russian oil.

Officials say the new rules will further pressure the Kremlin economically while maintaining the integrity of international sanctions enforcement.

UK Issues Temporary LNG Trade Licence Allowing Maritime Transport from Russian Sakhalin-2 and Yamal Projects Until 2027

The UK government has issued a new General Trade Licence permitting certain maritime transportation activities involving liquefied natural gas (LNG) originating from Russia’s Sakhalin-2 and Yamal LNG terminals. Published on 19 May 2026, the licence provides a temporary exemption under the Russia (Sanctions) (EU Exit) Regulations 2019, allowing companies to transport LNG by ship to or between third countries despite existing sanctions restrictions.

The licence authorises shipping operators and related service providers to supply or deliver LNG from the designated Russian terminals, as well as provide associated financial and brokering services. However, the activities are strictly limited to fulfilling “relevant contracts” with durations of one year or less. The LNG involved must also originate specifically from the Sakhalin-2 or Yamal LNG terminals.

The authorisation comes with compliance obligations, including mandatory record-keeping and a requirement to notify the UK Department for Business and Trade within 30 days after the activity begins. The licence takes effect on 20 May 2026 and will remain valid until 1 January 2027, unless amended, suspended, or revoked earlier by the Secretary of State. The measure aims to support controlled global LNG supply continuity while maintaining broader sanctions enforcement.

UK Tightens Russia Sanctions with Sweeping Energy, Trade, and Shipping Restrictions

The UK government has introduced a major new package of sanctions against Russia through the Russia (Sanctions) (EU Exit) (Amendment) Regulations 2026. The measures are designed to weaken Russia’s military-industrial capabilities and restrict its economic growth following the ongoing conflict in Ukraine.

The sanctions expand export bans on industrial chemicals, metals, carbon fibre products, semiconductor-related technologies, AI components, and quantum technology materials that could support Russian military production. New import restrictions prohibit refined oil products made from Russian crude and uranium originating from or shipped through Russia. The UK also introduced a ban on maritime transportation services linked to Russian Liquefied Natural Gas (LNG), aligning closely with recent European Union measures.

Additionally, the regulations strengthen shipping sanctions by targeting “specified ships” associated with Russia’s shadow fleet. The rules prohibit chartering, operating, financing, or servicing these vessels and give authorities expanded enforcement powers. The government estimates the measures could cost UK businesses billions over the next decade, particularly due to impacts on global energy prices and LNG supply chains. Despite economic risks, the UK says the sanctions are necessary to maintain pressure on Russia and support Ukraine’s sovereignty and long-term security.

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Sanctions Watch is a weekly recap of events and news related to sanctions around the world.