Sanctions on Gazprom are layered and uneven: the United States, European Union, and United Kingdom have deliberately kept the parent company, PJSC Gazprom, off the most restrictive lists to avoid an immediate cutoff of energy supply, while imposing full blocking sanctions on its oil arm Gazprom Neft, its main bank Gazprombank, and a growing list of related entities. The result is a regime that restricts financing, cuts off advanced technology, bans petroleum services, and now points toward a full EU phase-out of Russian gas, while leaving narrow channels open for remaining trade.
How the Parent and Subsidiaries Are Designated
PJSC Gazprom itself sits on OFAC’s Non-SDN list. It is not subject to a full asset freeze. The restrictions on the parent are narrower: a prohibition on dealings in new debt exceeding 14 days’ maturity or new equity issued on or after March 26, 2022, under Directive 3 of Executive Order 14024, plus restrictions under Executive Order 13662 Directive 4 tied to the Russian energy sector.1U.S. Department of the Treasury. Sanctions List Search – Public Joint Stock Company Gazprom The intent is to choke off long-term development without collapsing current supply.
Gazprom Neft, the group’s oil-producing subsidiary, is treated very differently. In the United States it is subject to Directives 2 and 4 under Executive Order 13662 and Directive 3 under Executive Order 14024.2U.S. Department of the Treasury. Sanctions List Search – Public Joint Stock Company Gazprom Neft OFAC’s action on January 10, 2025 imposed full blocking sanctions on Gazprom Neft, accompanied by a wind-down general license for orderly divestment. The United Kingdom has separately imposed an asset freeze on Gazprom Neft under the Russia (Sanctions) (EU Exit) Regulations 2019.3GOV.UK. Russia Financial Sanctions Notice The EU has imposed a transaction ban on Gazprom Neft under Article 5aa and Annex XIX of Council Regulation 833/2014, and the 19th sanctions package tightened those restrictions by withdrawing exemptions that had covered oil and gas transactions involving Russia and certain Gazprom Neft minority-owned energy projects abroad.
The heaviest financial blow landed in November 2024, when OFAC designated Gazprombank Joint Stock Company as a fully blocked entity along with six foreign subsidiaries in jurisdictions including Luxembourg and Hong Kong. Gazprombank had been the group’s primary financial institution and the main channel for European gas payments. All property and interests in property held by U.S. persons must now be frozen, and virtually all transactions with the bank are prohibited unless a specific general license applies. OFAC issued general licenses authorizing wind-down of existing transactions and divestment from Gazprombank debt or equity.4U.S. Department of the Treasury. Treasury Sanctions Gazprombank and Takes Additional Steps to Curtail Russia’s Use of the International Financial System
The 50 Percent Rule
Many Gazprom-group entities never appear on any published sanctions list yet are still off-limits. Under OFAC’s 50 percent rule, any entity owned 50 percent or more, directly or indirectly, by one or more blocked persons is automatically treated as blocked. Ownership held by different blocked persons is aggregated even across different sanctions programs, so two separately sanctioned individuals each holding 25 percent make the company blocked.5Office of Foreign Assets Control. Entities Owned by Blocked Persons – 50 Percent Rule For counterparties dealing with any part of the Gazprom Group, this means dozens of subsidiaries and joint ventures may be restricted if ownership traces back to Gazprom Neft or Gazprombank.
The Bureau of Industry and Security is expected to implement its own version of a 50 percent rule in November 2026, imposing separate export licensing requirements for items sent to entities majority-owned by parties on the BIS Entity List, Military End-User List, or certain SDN designees. When that rule takes effect, compliance screening will need to run against both frameworks simultaneously.
What the Financing Restrictions Actually Block
Directive 3 under Executive Order 14024 prohibits transactions in new debt with a maturity longer than 14 days or new equity of PJSC Gazprom issued on or after March 26, 2022.6Office of Foreign Assets Control. FAQ 983 – Prohibitions Related to New Debt and Equity of Certain Russia-Related Entities Gazprom cannot issue bonds, raise equity, or secure long-term project financing from any U.S. person or through any transaction touching the U.S. financial system. Borrowing costs rise, and large infrastructure projects become dependent on non-Western financing.
For Gazprombank, the effect is more absolute. Because the bank is fully blocked, U.S. persons cannot process payments through it, hold accounts with it, or enter new transactions absent an OFAC authorization.7U.S. Department of the Treasury. Sanctions List Search – Gazprombank Joint Stock Company
Export Controls on Energy Technology
Export controls aim at Gazprom’s future capacity rather than current output. Under 15 CFR 746.5, BIS imposes licensing requirements for items destined for Russian deepwater (greater than 500 feet), Arctic offshore, or shale formation projects. For projects with the potential to produce oil, BIS applies a presumption of denial. For gas-only projects, applications receive case-by-case review.8Bureau of Industry and Security. Russian Oil and Gas Sanctions FAQs
Both the U.S. and EU also prohibit exporting a wide range of dual-use goods and advanced technologies to Russia. The controlled items are identified by specific Export Control Classification Numbers and Schedule B numbers rather than generic product descriptions. If an item is not listed by classification number in the regulations, the energy-sector rules do not impose additional license requirements on it. Over time, these limits erode Gazprom’s ability to develop frontier reserves and maintain aging infrastructure.
The Petroleum Services Ban
On January 10, 2025, Treasury issued a determination under Executive Order 14071 prohibiting the provision of petroleum services to Russia by U.S. persons wherever located. The scope reaches exploration, drilling, production, refining, processing, storage, transportation, and marketing of petroleum, including crude oil and petroleum products, and any activities that contribute to Russia’s ability to develop domestic petroleum resources or expand production and refining capacity. Natural gas services are covered when the gas is a byproduct of oil production.9Office of Foreign Assets Control. FAQ 1216 – Prohibition on Petroleum Services
Three narrow exclusions apply. Services related to medical, agricultural, or environmental isotopes derived from petroleum manufacturing (such as Carbon-13) are permitted. Certain services related to maritime transport of Russian crude oil and petroleum products purchased at or below the G7 price cap are excluded. And services connected to the wind-down or divestiture of an entity located in Russia that is not owned or controlled by a Russian person are permitted. OFAC also extended a specific authorization under General License 55E for certain activities related to the Sakhalin-2 LNG project until June 18, 2026.
How European Buyers Now Pay for Gas
Russia’s original payment mechanism came out of Presidential Decree No. 172 in March 2022, which required buyers from “unfriendly” countries to open a foreign currency account and a ruble-denominated “K-account” at Gazprombank. Buyers deposited euros or dollars, and Gazprombank converted the funds to rubles to complete payment.10European Commission. Frequently Asked Questions on Gas Import Related Provisions The European Commission’s guidance said EU companies could pay in their contract currency into the foreign currency account and make a clear statement that this payment fulfilled the contractual obligation, treating the transaction as complete before ruble conversion.
Gazprombank’s November 2024 designation upended the arrangement. With the bank blocked under U.S. sanctions, the K-account channel became unworkable. In December 2024, Putin amended Decree No. 172 to suspend K-account payments until Western sanctions on Gazprombank are lifted. Alternative payment arrangements have reportedly been established, but the file does not describe them in detail and the mechanics remain subject to change.
Separately, OFAC has authorized certain transactions related to vessel emergencies under General License 57A, a narrow carve-out for safety situations rather than routine trade.11Office of Foreign Assets Control. Selected General Licenses Issued by OFAC
Secondary Sanctions Risk for Non-US Companies
The reach of these measures extends beyond U.S. persons. Under Executive Order 14024, OFAC can designate any foreign person who has materially assisted, sponsored, or provided financial, material, or technological support to a blocked person or to sanctionable activities. Executive Order 14114 extended this authority to foreign financial institutions that facilitate transactions involving Russia’s military-industrial base.12Office of Foreign Assets Control. Russian Harmful Foreign Activities Sanctions A company in the UAE, Turkey, or China that helps Gazprom Neft move money or source restricted equipment could itself land on the SDN list and lose access to the U.S. financial system. The PJSC Gazprom listing itself carries a secondary sanctions risk flag citing 31 CFR 589.201 and 589.209.1U.S. Department of the Treasury. Sanctions List Search – Public Joint Stock Company Gazprom
The EU Phase-Out of Russian Gas
Beyond restricting Gazprom’s operations, the European Union has adopted a binding phase-out of Russian gas imports. For short-term supply contracts concluded before June 17, 2025, the prohibition on LNG takes effect on April 25, 2026. Pipeline gas imports are subject to a prior authorization requirement by customs or licensing authorities, with exemptions for certain non-EU supplier countries based on volume thresholds and infrastructure constraints.13European Commission. REPowerEU – Phase Out of Russian Energy Imports Around 35 billion cubic meters of Russian gas were still flowing to the EU annually at the point the phase-out was announced, a figure declining as contracts expire. The EU expects remaining imports to end within roughly two years. The expiration of the Ukraine gas transit agreement at the end of 2024 already closed one major route, leaving TurkStream as the primary remaining pipeline pathway into southeastern Europe.
How the G7 Oil Price Cap Fits In
Gazprom Neft’s oil operations also intersect with the G7 price cap coalition. EU operators may provide maritime transport and related services for Russian crude oil and petroleum products only when those commodities are sold at or below the applicable cap. The crude oil cap has been in effect since December 5, 2022, with petroleum product caps following on February 5, 2023.14European Commission. Price Cap Coalition Statements and Guidance The U.S. petroleum services ban preserves a narrow carve-out for maritime transport when the oil is purchased at or below the cap.
The January 2025 blocking sanctions on Gazprom Neft complicate that safe harbor. Because Gazprom Neft is now on the SDN list, U.S. persons face a near-total prohibition on transactions with the company regardless of the cap, and international shipping and insurance providers that had relied on the price cap framework for Russian oil cargoes now have to reconcile it with the full blocking regime on this particular seller.