Oil Prices Surge After Trump Administration Slaps Major Sanctions on Russian Energy Giants
Oil prices spiked sharply on Thursday after President Trump’s administration announced sweeping sanctions against two of Russia’s largest oil producers — a move aimed at tightening economic pressure on Moscow over its ongoing war in Ukraine.
Brent crude jumped more than 5%, while West Texas Intermediate (WTI) crude climbed over 5.2% in early trading, signaling renewed volatility in global energy markets.
U.S. Targets Rosneft and Lukoil
The sanctions target Rosneft and Lukoil, Russia’s biggest oil companies, both seen as key sources of funding for Vladimir Putin’s war effort.
“Because President Putin continues to prolong this needless conflict, the Treasury Department is taking action against Russia’s two biggest oil producers that bankroll the Kremlin’s military,” Treasury Secretary Scott Bessent said in a statement. “We’re urging our allies to join us in implementing and upholding these sanctions.”
According to U.S. officials, Russia’s oil and gas revenues — down roughly 21% year-over-year — make up about one-quarter of the country’s federal budget, providing critical cash flow for military operations in Ukraine.
Mixed Economic Impact for Moscow
Analysts note that while these sanctions will hit Russia’s financial system hard, the country may not feel the full impact immediately. That’s because most of Russia’s energy revenue comes from taxes on oil production rather than exports, softening the initial blow.
Still, the sanctions are expected to strain the country’s ability to sell oil abroad, especially as Western nations tighten banking restrictions.
Zelenskyy Welcomes U.S. Action
Ukrainian President Volodymyr Zelenskyy praised Washington’s move, calling the sanctions “very important,” though he urged the West to continue ramping up pressure until Moscow agrees to a ceasefire.
In contrast, Russia’s Foreign Ministry dismissed the measures, boasting that the country has developed “a strong immunity” to Western sanctions.
China and India Forced to Reassess Russian Oil Deals
The new U.S. restrictions give global energy companies until November 21 to wind down transactions with Rosneft and Lukoil.
That deadline is already reshaping global oil trade.
India’s state-owned refiners have begun preparing to sharply reduce imports of Russian crude to comply with U.S. policy, according to Reuters. Meanwhile, major Chinese oil firms — including PetroChina, Sinopec, CNOOC, and Zhenhua Oil — are expected to pause Russian purchases, at least temporarily, to avoid exposure to Western financial sanctions.
“The sanctions could force major Asian refiners to find alternative suppliers or risk being shut out of the Western banking system,” said Ole Hansen, chief commodities analyst at Saxo Bank.
Market Reaction
Traders say the announcement injected fresh volatility into oil markets, with prices swinging sharply as investors assessed potential supply disruptions. Lukoil, in response, canceled a planned board meeting and dividend discussion, citing “the new circumstances.”
As energy prices surge and sanctions tighten, the Trump administration’s latest move underscores a growing effort to weaken Moscow’s war chest — while reshaping the global oil map in the process.
