Russia reacted with anger on Thursday, October 23, 2025, after President Donald Trump imposed sweeping sanctions on Rosneft and Lukoil, the country’s two largest oil companies.
The move marks the first major economic punishments against Moscow in Trump’s second term and follows the White House’s decision to cancel a planned summit with President Vladimir Putin.
Initial market reaction was sharp, with oil prices jumping about 5 percent after the announcement, according to Reuters.
What Washington announced
The Treasury Department’s Office of Foreign Assets Control designated Rosneft and Lukoil under Executive Order 14024, blocking their property and interests in property under U.S. jurisdiction and restricting most transactions with U.S. persons.
Treasury also listed multiple subsidiaries and reminded companies that entities 50 percent or more owned by sanctioned firms are likewise blocked.
The release outlined potential exposure for non-U.S. actors that facilitate significant transactions with the newly designated entities.
The White House tied the sanctions to Russia’s continued assault on Ukraine and the breakdown in talks that had been expected to culminate in Budapest. U.S. officials emphasized that the measures are aimed at oil revenue that finances the war effort.
Moscow’s reaction and the canceled summit
Speaking to reporters in the Kremlin on Thursday, Putin called the sanctions an “unfriendly act,” saying they were serious but would not significantly harm Russia’s economy. He warned of possible effects on global energy prices.
The Kremlin has maintained that talks remain possible but criticized Washington’s decision to postpone the meeting.
Former president Dmitry Medvedev, now deputy chair of Russia’s Security Council, used sharper language, characterizing Trump’s actions as akin to an act of war and deriding what he cast as a self-styled peacemaking posture.
Foreign Ministry spokeswoman Maria Zakharova told journalists that Russia has developed “immunity” to Western restrictions, a line consistent with recent ministry briefings summarized by international outlets, including the Economic Times.
Kyiv and European partners welcomed the U.S. move. In Brussels, President Volodymyr Zelenskyy said, “We waited for this. God bless, it will work,” while urging further pressure on Moscow.
How the sanctions could bite
Rosneft and Lukoil together account for roughly half of Russia’s oil production, making the designations the most far-reaching U.S. penalties on Russian corporate champions since the invasion began in 2022.
A Reuters explainer put their combined share near the 50 to 55 percent range and detailed Rosneft’s international ties, including supply deals and stakes in refineries abroad.
Oil markets responded immediately. Brent and U.S. crude climbed after the announcement as traders weighed potential disruptions to global flows. Kuwait’s oil minister said OPEC was prepared to adjust output if needed to stabilize supply.
Analysts noted that any hit to Russian barrels might be partly offset by higher prices if buyers demand a risk discount on sanctioned crude.
