How a new package of sanctions could change the configuration of the oil industry

A commentary by Natalia Ivanova, Director of the petrochemical company NAPOR JSC, was published in the business newspaper *Kommersant*; it addressed potential shifts in the structure of the oil industry amidst preparations for a new package of sanctions against Russia.

Western nations are preparing a 20th package of restrictions against Russia. The primary focus is on further tightening controls over the re-export of Russian oil and curtailing the "shadow fleet." However, market participants estimate that the key risks facing the industry today stem less from external measures than from internal production agreements and the restructuring of logistics. Natalia Ivanova, Director of the company Napor, discussed the potential impact of these new restrictions on the oil industry.

2025 has been a period of systemic pressure for the Russian fuel and energy sector. At the very beginning of the year, the US imposed an extensive package of restrictions targeting companies in the oil, gas, and petrochemical sectors. Virtually every link in the supply chain was affected, ranging from major upstream producers to chemical suppliers and service contractors. The performance of industry giants faltered first, followed by a ripple effect that impacted small and medium-sized enterprises (SMEs). The consequences are tangible; according to some sources, the aggregate revenues of Russian oil and gas companies fell by 21.4% in early 2025.

The new—20th—sanctions package entails an expansion of so-called secondary measures targeting companies involved in the transport, insurance, transshipment, and chartering of vessels linked to Russian supplies. The "shadow fleet"—aging tankers operating outside Western service networks—also remains a key focus.

However, the long-term effectiveness of such measures is open to question. Market participants note that the industry has learned to operate—and adapt—amidst these heightened challenges by restructuring its logistics.

The export of oil and petroleum products remains a key source of state revenue; consequently, industry decisions are made through close cooperation between business and regulators. According to Natalia Ivanova, the development of measures to mitigate the impact of the new sanctions package is likely already complete.

Experience gained in 2022–2023 has enabled the creation of robust mechanisms to circumvent technological and logistical constraints. Therefore, industry experts estimate that this new pressure is unlikely to trigger drastic changes in production levels. The production decline currently observed in Russia stems primarily from internal OPEC+ agreements and corporate production policies rather than from external bans.

Sanctions have radically altered the architecture of export flows. Shipments to Europe have dwindled to negligible volumes, while China and India have emerged as the primary destinations. This shift is now firmly established; in Natalia Ivanova’s view, new sanctions may drive up logistics costs but will not alter the overall strategy.

China has become a key supplier of components and reagents for the petrochemical industry. Russian companies have transitioned to a full-cycle approach—adapting formulations, developing new compounds, and upgrading existing ones—and this supply chain has proven resilient.
At the same time, exports of Russian technologies to the Middle East are growing. Saudi Arabia, the UAE, and Oman are showing interest in Russian innovations regarding oilfield services and chemicals for enhanced oil recovery. According to Ivanova, the region prioritizes economic viability above all else: if a technology is competitive, there is demand for it—the country of origin is a secondary concern for buyers.

The primary impact of the new package is a further increase in logistics costs and greater complexity in documentation processes. However, established ties with Asian suppliers, along with countermeasures prepared by the state and the business sector, ensure relative stability for the industry.

The market takes a pragmatic view: new sanctions are perceived as additional operational challenges rather than a threat to the industry's functioning. Experience with the previous 19 packages suggests that the 20th will not prove critical for the Russian oil sector either.