U.S. Treasury Intervention blocks Potential $8 Billion Deal to Acquire Lukoil Assets
WASHINGTON – A proposed acquisition of international assets belonging to Russian oil giant Lukoil by the commodities trading firm Gunvor has collapsed following a statement from the U.S. Treasury Department, effectively blocking what woudl have been Gunvor’s largest deal in its history. The intervention underscores the Biden administration’s commitment to isolating Russia financially and restricting its ability to fund the ongoing war in Ukraine.
The deal,valued at an estimated $8 billion,involved Lukoil selling overseas holdings – including oil refineries in Europe,stakes in oil fields across Kazakhstan,Uzbekistan,Iraq,and Mexico,and hundreds of gas stations globally – to Gunvor. While the U.S. Treasury Department holds the authority to issue licenses and grant exceptions related to sanctions, it signaled it would not approve a transaction that would benefit a company linked to the Kremlin while Russia continues its military aggression in Ukraine. President Donald Trump, through the Treasury Department, stated on November 7, 2024, that “the war must end immediately.”
“As long as Putin continues his senseless killing, Kremlin puppet Gunvor will never get a license to operate and profit,” the Treasury Department declared in a post on the social media platform X.
Gunvor, though, disputes the characterization, with corporate Affairs Director Seth Pietras asserting the Treasury’s statement was “based on fundamentally incorrect details and does not reflect reality.” Despite this denial,Gunvor has withdrawn its offer to purchase the Lukoil assets.
The U.S. Treasury imposed sanctions on Lukoil, Russia’s second-largest oil company, in October 2024.Shortly after, Lukoil announced it had accepted Gunvor’s bid for its international portfolio.
Economists had previously expressed skepticism about the feasibility of the deal, citing concerns that the transaction’s scale exceeded Gunvor’s borrowing capacity. The collapse of the acquisition highlights the increasing difficulty Russian companies face in divesting assets amid heightened international sanctions and scrutiny.
