On July 18, 2025, the European Union adopted its 18th package of sanctions against Russia, detailed in amended Regulation (EU) 833/2014 and Regulation (EU) 269/2014. These measures aim to further restrict Russia’s ability to finance its war efforts and include new listings, adjustments to the oil price cap, and enhanced trade restrictions.
New Vessel and Asset Freeze Listings
- “Shadow Fleet” Sanctions: The EU has imposed a ban on 105 vessels from accessing EU ports or receiving maritime and other services. These vessels are identified as part of the Russian “shadow fleet” (Article 3s of EU Regulation 833/2014). Three LNG tankers operated by Mitsui O.S.K. Lines were removed from this list after assurances that they would not transport gas from the Russian Yamal and Arctic 2 projects. The total number of vessels listed in Russia’s shadow fleet by the EU now stands at 444.
- Individuals and Entities Designated: 14 individuals and 41 entities have been added to the EU sanctions list, subjecting them to an asset freeze. This includes entities associated with Coral Energy/2Rivers Group (already subject to UK asset freeze restrictions) and Nayara Energy Limited, an Indian refinery with a major shareholding by Rosneft.
Oil Price Cap Adjustments
- Crude Oil Price Cap Reduction: The price cap for Russian origin crude oil (CN Code 2709) has been reduced from USD 60 to USD 47.60 per barrel, effective September 3, 2025.
- Contracts entered into on or after July 20, 2025, can still rely on the USD 60 per barrel cap but must be wound down by September 2, 2025.
- Contracts entered into before July 20, 2025, must be concluded by October 18, 2025.
- Dynamic Price Cap Mechanism: The EU Commission will implement a dynamic mechanism to update the oil price cap, based on price assessments from ‘authorized reporting agencies’. This new system ensures the price cap will always be 15% lower than the average market price for Urals crude (the benchmark for Russian oil exports) over the preceding six months. If the newly calculated price varies by 5% or less from the current cap, no amendment will be made. The EU Commission will publish notices and amend the price cap on January 15, 2026, and every six months thereafter, with the amended cap applying from the first day of the month following the entry into force of the relevant implementing regulation.
- UK Alignment: The UK has also reduced its price cap for Russian origin crude oil to USD 47.60 per barrel, effective 23:01 (BST) on Tuesday, September 2, 2025. A 45-day wind-down period (ending 23:01 (BST) on Friday, October 17, 2025) applies to contracts with an effective date before September 2, 2025, that complied with the previous USD 60 cap.
- US Position: The US, a party to the G7 price cap scheme, has not reduced the price cap for Russian origin crude oil.
- Petroleum Products Price Cap: The price cap for petroleum products (CN Code 2710) remains unchanged at USD 100 per barrel for Premium to Crude products and USD 45 per barrel for Discount to Crude products.
Trade Restrictions
- Refined Petroleum Products from Third Countries: From January 21, 2026, it will be prohibited to import or transport into the EU (or provide related insurance for) refined petroleum products processed from Russian origin crude oil in third countries (Article 3ma of EU Regulation 833/2014). Exemptions apply to imports from Norway, the UK, the US, Canada, and Switzerland. For other third countries, evidence of the crude oil’s country of origin will be required for import into the EU.
- Industrial Capacities Expansion: The list of goods subject to restrictions due to their potential contribution to enhancing Russian industrial capacities has been expanded (Article 3k of EU Regulation 833/2014). These restrictions, subject to wind-down periods, prohibit the transport of these goods to Russia (and related insurance), regardless of their EU origin. The expanded list includes specific commodity codes for items such as Molybdenum ores, distillation products of high temperature coal tar, various elements (Fluorine, chlorine, bromine, iodine, sulphur, carbon, hydrogen, rare gases, other non-metals), metal oxides (Zinc, Iron, Cobalt, Titanium), certain iron and steel articles (Chain, other articles), and most copper and aluminum articles.
- Circumvention of Advanced Technology Exports: Measures have been introduced to address the risk of circumvention of advanced technology item exports via third countries. An authorization will now be required for the export of goods and technology to any third country that might contribute to Russia’s military and technological enhancement (Article 2a of EU Regulation 833/2014). This applies if the exporter is informed by the competent EU Member State authority of reasonable suspicion that the items’ end destination may be Russia or their end-use for Russian entities.
Nord Stream Pipelines
Transactions related to Russia’s Nord Stream 1 and Nord Stream 2 gas pipelines are now banned. This includes the provision of goods or services concerning the completion, operation, maintenance, or use of these pipelines, effectively aiming to prevent any future resumption of Russian gas flows through these routes.
Transaction Ban Exception for Non-Russian Coal
The EU has formalized an FAQ regarding the transaction ban against listed Russian ports, which was introduced in the EU’s 16th sanctions package. A new exception allows the transport of non-Russian coal (falling under CN code 2701) from these ports, provided it originates in a third country and is only being loaded in, departing from, or transiting through Russia. Both the origin and the owner of the goods must be non-Russian (Article 5ae(3)(g) of EU Regulation 833/2014).
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Source: Gard
