Westminster Policy News & Legislative Analysis

UK outlines plan: Russia oil sanctions and sovereign asset loans

Prime Minister Keir Starmer used a London press conference to set out a coordinated plan with France and Ukraine to increase pressure on Moscow and stabilise Ukraine’s position going into winter. The UK aligned itself with a call from US President Donald Trump for an immediate ceasefire and talks on the basis of the current line of contact, framing the agenda around energy sanctions, sovereign assets, air defence, long‑range strike support and future security guarantees. The remarks were delivered at the Foreign, Commonwealth & Development Office on 24 October 2025.

On energy, the Prime Minister said the UK “last week” became the first state to sanction all major Russian oil producers and called on partners to sustain pressure. That UK step, taken on 15 October, added Rosneft and Lukoil to earlier designations of Gazprom Neft and Surgutneftegas. Washington followed on 22 October by placing Rosneft and Lukoil under US sanctions, while the EU adopted a new package on 23 October targeting Russian energy revenues and associated networks. Together these measures are intended to restrict Russia’s export income through direct listings, tighter enforcement and limits on maritime workarounds.

For companies and financiers, compliance exposure now widens across trading, shipping, insurance and finance. The EU’s 19th package introduces a phased ban on Russian LNG imports, expands listings across the “shadow fleet” and related service providers, and curbs third‑country channels assisting Russia’s energy trade. Brussels also signalled restrictions on reinsuring vessels linked to sanction evasion and lifted the number of designated ships to the hundreds, increasing screening burdens for port operators, brokers and P&I clubs.

On funding, London said partners would press ahead with work on Russian sovereign assets to raise substantial financing for Ukraine’s defence. That aligns with the G7 Extraordinary Revenue Acceleration model under which loans are serviced by proceeds from immobilised Russian state assets. The United States disbursed $20 billion under this scheme in December 2024, the EU sent an initial €3 billion in January 2025 and has continued with follow‑on tranches this year. The UK signalled support for accelerating similar flows, which it characterised as “reparations loans”.

On air defence, the Prime Minister confirmed the UK is accelerating deliveries from the existing order of more than 5,000 Lightweight Multirole Missiles manufactured by Thales in Belfast. The Ministry of Defence signed the £1.6 billion order in March, supporting around 900 UK jobs directly and in the supply chain; in October, ministers said hundreds of these missiles were arriving months early. Starmer added that a further 140 units are being brought forward to strengthen Ukraine’s protection of civilians and energy assets over winter.

Military support will also continue to include long‑range capabilities, the Prime Minister said. Looking beyond active hostilities, London and Paris are advancing work on “Multinational Force Ukraine” planning to provide a reassurance force once a ceasefire holds, with a UK‑French operational headquarters in development and partners preparing contributions. This would sit alongside bilateral security guarantees already agreed with Kyiv.

Starmer linked the external agenda to domestic security after a UK court sentenced six men for an arson attack on an East London warehouse storing aid and satellite equipment bound for Ukraine. The judge described a planned campaign in the interests of the Russian state; sentences ranged up to 17 years’ imprisonment. The Prime Minister said such incidents underline that “your security is our security”.

Timelines now matter. EU LNG measures phase in over months, with short‑term contracts ending sooner and long‑term agreements to cease by 1 January 2027. US sanctions on Rosneft and Lukoil apply immediately through OFAC’s listing regime, and UK listings require rapid updates to sanctions screening and contractual warranties. Governments are also signalling more designations across shipping and facilitators as winter energy demand rises.

The political message from London is that pressure will remain the priority until Moscow engages in credible talks. The government is urging allies to reduce remaining dependencies on Russian hydrocarbons and to discourage third‑country purchases of Russian-origin oil and gas. The Coalition of the Willing will revisit delivery milestones before year‑end, with progress judged against sanctions enforcement, asset‑backed financing to Kyiv, and the resilience of Ukraine’s air defence through winter.