How sanctions loopholes allow EU companies to help the Kremlin sell liquefied gas
From 1 January 2027, a complete ban on imports of Russian liquefied natural gas (LNG) into the European Union will come into force. However, after the adoption of the EU’s 21st sanctions package, a temporary exemption was retained for certain supplies to third countries under existing contracts. It currently remains in effect until 25 July 2027, is limited to 2025 supply volumes and requires quarterly reporting by the European operator involved.
This means that current European sanctions policy is aimed at the geographical redirection of Russian LNG exports rather than their complete isolation. Cargoes that previously arrived at European terminals will instead be sent to China, India or other third countries.
The long-awaited import ban will not have its full effect if European companies continue to buy, resell, transport or insure Russian LNG for other markets.
Read more about the problem and how it could be solved in an article by Olha Kondratiuk of Razom We Stand: For profit and against sanctions: how EU companies facilitate Russian gas exports around the world.
The European Commission had previously emphasised that the 2027 ban covers the trade and transfer of Russian LNG regardless of its final destination. However, the introduction of the new "temporary" exemption in the 21st sanctions package significantly weakens this position.
A critical factor in 2027 will be British sanctions policy.
Despite introducing a ban on servicing Russian LNG exports in the spring of 2026, the United Kingdom simultaneously introduced a general trade licence allowing LNG to be transported from the Yamal LNG and Sakhalin-2 terminals to third countries, along with related financial and brokerage services.
The licence expires on 1 January 2027. If the United Kingdom takes a firm position and does not renew it, this would block another six ice-class LNG tankers that transport more than one-third of Yamal LNG’s annual exports. It would also affect insurance services currently used by the Greek Dynagas fleet.
During negotiations on the EU’s 21st sanctions package, Greece defended the interests of its shipping sector, particularly the company Dynagas. The company operates specialised LNG tankers involved in shipments from Yamal LNG.
Dynagas also operates five ice-class LNG tankers that transport one-third of Yamal’s annual exports. This company is specifically credited with being the main force behind the new loophole for EU operators.
However, as long as vessels operated by European companies continue working for Russia’s energy sector, Europe will effectively remain part of Russia’s export infrastructure.
Will Europe stop helping Russia transport, insure and sell its LNG? This will be a key question in 2027.
The behaviour of European companies demonstrates just how difficult it will be to exit Russian contracts without additional legislative restrictions and stricter oversight. In particular, companies are in no hurry to terminate their contracts.
This shows that restrictions on the commercial interests of EU companies and their ties to Russian gas must be imposed through EU regulations and national laws. Otherwise, companies will simply continue with "business as usual".
Another weak point is the absence of a comprehensive ban on the sale and transfer of LNG tankers. Without restrictions on transferring vessels, Russian projects can use sales, re-registration, new owners and complex chartering arrangements to maintain access to shipping capacity. Ice-class tankers, which are essential for navigation in Arctic waters, are particularly important.
The involvement of European operators in Russian LNG exports undermines EU unity.
It also contradicts the stated policy of reducing dependence on Russian energy. The commercial interests of EU companies are currently competing with Ukraine’s security interests and the EU’s broader policy of containing Russia.
For restrictions on Russian LNG exports to be genuinely effective and painful for the Russian economy, the EU and the United Kingdom must completely prohibit their companies from facilitating those exports.
This means not renewing the British general licence after 1 January 2027, and prohibiting European operators from reselling or servicing Russian LNG exports regardless of the final market. It also means introducing real restrictions on the sale and transfer of LNG tankers and strengthening oversight of charter agreements, transshipment operations and changes of ownership.