EU Imposes Broad Ban on Russian Refined Oil Products to Close Sanctions Loopholes

The European Union has implemented its 18th sanctions package against Russia, focusing on closing loopholes that have allowed Russia to maintain substantial oil revenues despite ongoing restrictions. Central to the new measures is a ban on importing refined oil products made from Russian crude in third countries that are not part of the sanctions coalition, targeting re-export hubs like India and Turkey. The sanctions also lowered the price cap on Russian crude oil to $47.60 per barrel with a mechanism to keep it 15% below the six-month average Urals price, effective September 3, 2025. However, Russia continues to evade sanctions through a shadow fleet of tankers and anonymous operators, while countries such as China and India increase discounted purchases, undermining the sanctions' effectiveness. Despite these efforts, Russia’s oil export revenues remain high, exceeding its military spending, and the EU’s ban may shift supply routes and create opportunities for Gulf producers to fill gaps in European fuel imports. U.S. President Donald Trump's threat of secondary sanctions, including 100% tariffs on Russian oil importers if Moscow does not end the war quickly, is seen as one of the few remaining significant economic pressures on Russia, although such moves risk global energy market disruptions.