On December 5, 2022, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) announced a $60 per barrel price cap on maritime transfers of Russian-origin crude oil. The final cap level is being implemented multilaterally by the Price Cap Coalition, which include the Group of 7 (G7) nations and Australia.
Various reports indicate that the Group of Seven nations (G7) will announce its initial capped price for Russian-origin crude oil transported by maritime means (“seaborne”) this week. The cap will come into effect on December 5, 2022, for crude oil (including condensate) and February 5, 2023, for petroleum products.
In response to Russia/Ukraine conflict, and Belarus’ ensuing support for Russia, the United States and global allies have imposed sweeping sanctions and export control restrictions on both Russia and Belarus. These actions are discussed extensively in our prior publications.
The sanctions and export controls restrictions especially target Russia and have had a significant impact on the Russian economy. Virtually every industry is impacted, and Russia’s financial institutions, businesses and prominent individuals are being targeted by ever-widening sanctions and export control restrictions imposed by the United States and global allies. As the situation evolves, further restrictions remain possible.
In the final few days of September, the U.S. and global allies issued a number of sanctions and export controls against actors who have supported Russia’s referendums in Ukraine and related attempts to annex four Ukrainian territories. The referendums have been condemned by the Group of 7 (G7) nations, which committed to imposing further economic costs on individuals and entities both inside and outside of Russia.
The latest measures include actions by the Office of Treasury’s Office of Foreign Assets Control (OFAC), the U.S. Department of Commerce’s Bureau of Industry and Security (BIS), the U.S. Department of State, and the United Kingdom (UK) Office of Financial Sanctions Implementation (OFSI), as well as further announcements from the European Union (EU), described in turn below.
Takeaways
On September 2, 2022, the Group of 7 (G7) nations formally announced its consensus to implement a global price cap on Russian oil and petroleum products in response to the ongoing conflict in Ukraine. The Joint Statement does not provide a specific timeline for implementation of the price cap, but notes that it seeks to align implementation with related measures within the EU’s sixth sanctions package, which will come into effect on December 5, 2022. (See here for prior analysis of this package.) The initial capped price has not been announced, and will be decided by the full coalition in advance of implementation.
EU introduces a sixth package of sanctions.
On June 3, 2022, the EU adopted a sixth package of sanctions against Russia which includes economic, individual, media and diplomatic measures. (See the full text of the regulation here.) Continue reading →
We’ve covered in depth the array of sanctions-related activity brought by the international community against Russia in response to the conflict in Ukraine. As these measures mount, Russia has in return taken steps to alleviate some of the pressure such sanctions have brought to bear. In “Russia Introduces Tools for Russian Persons to Continue Use of Foreign IP Rights without Consent from Rightsholder,” Nancy A. Fischer, Aaron R. Hutman and
On May 8, 2022, the White House announced a number of new measures in response to Russia’s ongoing war in Ukraine. The new measures include prohibitions on new categories of services to Russia by U.S. persons; export controls on certain industrial goods; and the addition of several shipping companies, bank executives, and television companies to the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) Specially Designated Nationals and Blocked Persons (SDN) List.
EU introduces a fifth package of measures.
New asset freezes
On April 8, 2022, the EU published a fifth round of measures against Russia and Belarus. Spread across four regulations, the new measures include additional asset freezes against 217 individuals and 18 entities. Notable inclusions are Otkritie FC Bank, Novikombank, Sovcombank, VTB Bank, and JSC GTLK. The full list of new designations can be found in the Annex to Regulation (EU) 2022/581.
A wind down license is available for the termination of correspondent banking relationships with the newly frozen banks by October 9, 2022. A new ground for licensing has also been added so that member states may enable the sale by listed persons/entities of proprietary rights in EU companies, provided the proceeds of such sale and transfer remain frozen.
In the last month, the United States and global allies have issued unprecedented sanctions against Russia in response to the war in Ukraine. These sanctions apply ever-expanding pressure on the Russian economy and touch virtually every industry. This post addresses the latest U.S. sanctions against Russia in the following categories: new investment prohibitions, finance, energy sector import and export rules, general export and import controls, expanded sanctions designations, and denial orders for Russian airlines under export control authorities. The U.S. government already is actively implementing these authorities around the world, as evidenced by recent enforcement actions.
Global Trade & Sanctions Law