UK relaxes Russian oil sanctions, permits refined imports from third countries

The UK government relaxed strict sanctions on Russian crude oil, permitting imports of jet fuel and diesel refined in third countries as costs surge.

A trade licence effective Wednesday allows indefinite imports and will be reviewed periodically.

The move comes amid growing concerns over fuel supplies due to the de facto blockade of the Strait of Hormuz since the US-Israeli conflict with Iran began.

The UK has led international efforts to pressure Russia economically over its war in Ukraine for years.

On Tuesday, Britain signed a G7 statement reaffirming “unwavering commitment” to imposing “severe costs” on Russia, having previously announced it would block Russian oil refined elsewhere to further restrict funds to the Kremlin.

This week, US Treasury Secretary Scott Bessent extended a 30-day sanctions waiver allowing purchases of Russian oil shipments already at sea, stating that the extension would “provide additional flexibility” and that the US would work with nations to provide specific licences as needed.

New figures show petrol prices have surpassed the high set during the Iran oil crisis.

Relaxing sanctions will permit jet fuel imports from India, previously a key UK and Europe supplier; Russian crude is also refined in large quantities in Turkey.

Emily Thornberry, chair of the foreign affairs committee, said it was the wrong time to relax sanctions.

She told BBC Radio 4’s Today programme: “I’ve heard from people in Ukraine overnight and I know that they are very disappointed and have been asking me why it is that Britain is doing this. We’re talking about our allies in Ukraine who have been fighting a war bravely against Russia for years and years with our support and they have looked to Britain as one of their most important allies and they don’t understand, given that we promised that we would stop this loophole in October and we still haven’t done it. In fact, it seems to have got worse. People feel very let down.”

With a negotiated solution to stopping the war in Ukraine very difficult at the moment, she said, “the only other way of pushing forward is by stronger sanctions.”

Thornberry said every time Vladimir Putin came to the negotiating table “he just takes the mickey”. “He needs to really feel the impact of continuing to be involved in the war in Ukraine and we should not take a foot off the pressure now,” she said.

Conservative leader Kemi Badenoch called the move “insane”. She posted on X: “After 18 months of ‘standing up to Putin’ the Labour govt quietly issued a licence allowing imports of Russian oil refined in third countries. Yesterday Labour MPs voted against UK oil and gas licences. We are now importing from Russia instead of drilling in the North Sea. Insane.”

Treasury minister Dan Tomlinson told Sky News the government needed to ensure it was “protecting the UK national interest”.

“When there are international conflicts … what we have to do as a government is make sure that we’re protecting the UK national interest, making sure that this impact of conflicts that wash up on our shore, that we’re protecting individual families,” he said. “The government has announced yesterday this time-limited change to the rules around oil and refining given the extremes of the impacts of the conflict in Iran, and the impact of it washing up on our shores.”

On Tuesday, the RAC said the average price of a litre of petrol at UK forecourts stood at 158.5p, the most expensive since December 2022. It has been widely reported that on Thursday, Chancellor Rachel Reeves will abandon her plan to increase fuel duty from September.