The European Council agreed on its first-ever sanctions on Russian liquefied natural gas (LNG), marking a major escalation in efforts to choke off the Kremlin’s energy revenues — a move that strikes at one of Moscow’s last lucrative trade lifelines and signals the bloc’s growing resolve to wean itself off Russian fuel.
The breakthrough came at Thursday’s European Council summit in Brussels, where leaders signed off on the measure as part of its 19th sanctions package against Russia. It underscores the bloc’s determination to sustain pressure on Moscow despite internal divisions over how to use some €140 billion in frozen Russian central bank reserves.
“The ban on the import of Russian LNG, which is pretty much a big step in the energy decoupling between the EU and Russia,” Daniel Hegedüs, regional director for Central Europe at the German Marshall Fund (GMF), told The Parliament.
Across the Atlantic, US President Donald Trump announced sweeping sanctions on Rosneft and Lukoil — a dramatic show of force, though one many fear could prove short-lived given Washington’s shifting stance Moscow.
Targeting Russian LNG and oil
After initial resistance from Slovakia, which cited concerns over energy prices and the car making industry, the EU’s rotating Danish Presidency confirmed a weeks-long deadlock over the sanctions package had ended.
Alongside measures targeting banks, crypto exchanges, and entities in China, the package includes the EU’s first-ever ban on imports of Russian LNG, set to take effect in early 2027. And, earlier this week, after a planned Trump-Putin summit in Budapest to discuss the war in Ukraine was indefinitely postponed — “a huge relief for EU leaders” said Roland Freudenstein, co-founder of the Brussels Freedom Hub — Trump imposed sanctions on Russian oil giants Lukoil and Rosneft.
The move, Putin admitted, could cause some economic pain as India and China reportedly scaled back purchases of Russian oil in response.
Combined, the sanctions could eventually be detrimental to Moscow's war effort in Ukraine. “It won't make Russian finances disappear from one day to the next, but it will be just another straw on the camel's back,” said Freudenstein. “For now, the Russian economy has been holding it together, but there may be a point when this gets too much and we will get serious trouble in Russian society.”
The Russian economy is suffering, he added, “and the combination of EU and US measures against oil and gas will have another detrimental effect on Russia.”
But doubts remain over whether Europe can rely on its transatlantic partner, whose Russia policy continues to swing between confrontation and conciliation. “A few days ago, we had a situation where everybody was worrying that Trump was completely changing his strategy vis-à-vis Ukraine,” Nicolas Véron, senior fellow at Bruegel, told The Parliament. “In the US you have a completely volatile partner whose unpredictability creates major strategic dilemmas for Ukraine.”
All eyes on frozen Russian assets
Despite the new sanctions, much of the debate in Brussels has refocused on Russia’s frozen assets, and whether they can be used to fund Ukraine’s defence.
Though the US sanctions are “symbolically very important,” said Hegedüs, marking the first package imposed under the Trump administration, he cautioned that the economic impact would likely be limited. “If we look at the content, the assets of Rosneft and Lukoil in the US are effectively non-existent, and trade with these companies is minimal. So the direct financial implications of the sanctions won’t be significant.”
According to the US department of trade, goods and services trade with Russia totaled an estimated $5.2 billion (€4.7 billion) in 2024.
For Ukraine, however, the outcome of a reparations loan funded by frozen Russian assets could prove existential. Without it, Ukraine faces a $60 billion budget shortfall over the next two years. “The issue of assets is very important for us,” Ukrainian President Volodymyr Zelenskyy told reporters in Brussels on Thursday.
But Belgium, which hosts Euroclear — the financial institution holding the lion’s share of the frozen assets — again withheld its approval of the proposal laid out by the European Commission on Thursday.
Speaking to reporters at the summit, Prime Minister Bart de Wever, warned he would only back the plan if specific conditions were met, including the “full mutualisation of risks.” In other words, unless financial and legal liabilities are fully shared among member states — and all EU countries make use of Russian sovereign assets held in their own jurisdictions — he would continue to block the proposal.
“If the green light will be given to this financial and legal construct that would allow the 140 billion loan for Ukraine, the message to the Kremlin and to Washington is that ‘whatever you might be considering and discussing, Ukraine will be financially viable for two or three years to come’,” said Hegedüs.
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