Closing the Loophole: have we done enough?

Despite heavy sanctions, Russia’s war machine is still fuelled by the revenues from their oil and gas, which are the raw materials required to manufacture plastic products. While countries like the UK are no longer direct consumers, loopholes continue to allow products made from Russian oil to infiltrate the global market. 

Despite a drop in exports to Europe, the Centre for Research on Energy and Clean Air (CREA) found that in 2024, total export revenues fell by only 5 percent. Revenue lost from European markets has been offset by shifting exports eastward making the current three largest importers China, India, and Turkey.

However, Russian hydrocarbons still reach sanctioning countries directly and indirectly. This occurs in two main ways: 

• Firstly, unlike the US and UK, the EU has not imposed a complete ban on all imports of Russian oil and gas. It exempts pipeline gas and liquefied natural gas (LNG). In the last year, LNG imports from Russia to Europe have increased significantly (14% higher in June 2026 than June 2025). 

• Secondly, refineries which use Russian oil such as in India or Turkey still sell their products to sanctioning countries. This is known as the refinery loophole.

  
  

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Closing the loophole

The EU launched its 18th sanction package in January and the UK has followed suit with a similar plan to target the refinery loophole. The new ban prohibits products made at refineries that use Russian oil and has been partially successful, leading to a 69% decrease of imports according to the Kyiv School of Economics Institute (KSE). However, the Institute estimates that around 50 thousand barrels per day, which cannot be confirmed as non-Russian, continue to reach EU ports. The CREA also reported that eight shipments to EU ports were completed in June that contained Russian oil products, highlighting the need for greater oversight.

The limitations of these piecemeal legislative changes expose how our reliance on the fossil fuel industry contributes to the survival of aggressor states like Russia. It is, therefore, crucial for a more permanent shift away from the global fossil fuel industry if we want to move towards a cleaner and more peaceful future.

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For more information contact: info@scarabtrust.org.uk

Image: Oil Prices, Oilfield - Image by Eden Moon from Pixabay (ST ref: 1401)