Russian Oil Revenue Decline Following Sanctions
According to a report from the International Energy Agency (IEA), Russia’s oil export revenues dropped by over $13 billion between October and November. This decline appears to reflect the effects of sanctions imposed on Russia’s oil sector by President Trump in late October.
The Russian News Agency TASS relayed IEA findings, noting that the government did not challenge the data. The IEA reported a 2% month-on-month decline in Russian oil exports, bringing the total to 7.35 million barrels per day in October 2025. Export revenues also saw a decrease of 2.81%, totaling $13.13 billion.
Interestingly, there had already been a small dip in oil revenues between September and October, but that drop was only about $420 million.
TASS pointed out that, compared to the same time last year, Russian oil export revenues were down by $2 billion.
In late October, President Trump and the Treasury Department announced sanctions on Russia’s largest oil companies, Rosneft and Lukoil. This move was a response to President Putin’s lack of serious engagement in peace talks regarding Ukraine, a situation escalating since his initial invasion in 2014 and more recently with a full-scale attack in February 2022.
Treasury Secretary Scott Bessent stated, “Now is the time to stop the killing and for an immediate ceasefire,” emphasizing that the sanctions were aimed at those financing the Kremlin’s military endeavors. He added that further measures might be taken if necessary to support Trump’s efforts to end the conflict.
Putin and Trump met in Alaska in August, intending to facilitate peace talks involving Ukrainian President Zelensky. However, after a phone conversation in October, Trump announced that planned face-to-face talks in Budapest were indefinitely postponed due to minimal progress in peace negotiations. The situation remains volatile, with active hostilities between Russia and Ukraine.
The IEA’s report suggested that sanctions on Lukoil and Rosneft might significantly affect not only Russia but also global energy market stability. Currently, Lukoil appears to be facing the most severe impacts. The company, which has a far-reaching international presence compared to Rosneft, is planning to sell a number of assets affected by the sanctions. On October 27, Lukoil acknowledged its intention to offload these assets, and the Treasury Department has allowed U.S. companies to conduct “wind-down” activities related to the company until November 21.
Lukoil declared force majeure in Iraq this week after the Iraqi government halted all payments to comply with U.S. sanctions. This declaration particularly affected operations at the West Khulna 2 oil field, which produces 400,000 barrels per day, with Lukoil holding a significant stake.
The company also has numerous assets in Africa, Bulgaria, and Romania, though it remains uncertain how many will be divested. Industry insiders have speculated that the sanctions could have a devastating effect on Lukoil.
An anonymous former official from a major oil company commented that “Lukoil is over,” suggesting that the situation could lead to a significant market influx from the sale of assets. Reports indicate that as much as 30% of Lukoil’s assets could be subject to market flow.
Analysts believe that Rosneft, being less reliant on foreign assets, may weather the sanctions with less destruction compared to Lukoil.
Ahead of the IEA report’s release, Bloomberg highlighted signs that the impact of sanctions is already being felt, noting that Russian oil tankers were taking on cargo at a slower pace. The publication reported that eight fewer tankers departed Russia in the week ending November 2 compared to the prior week, attributing this to cancellations from Chinese companies.
Moreover, asset sales seem to be stalling. According to TASS, Lukoil has formally requested an extension of the “wind-down” period allowed under U.S. law for Americans to do business with the company regarding asset purchases or previously agreed operations. This wind-down period is set to conclude on November 21. TASS also reported that Lukoil attempted to sell overseas assets to an international oil trader, but the sale was blocked by the U.S. government.
