On 23 July 2026, the Council of the European Union adopted its 21st package of restrictive measures against Russia, amending Regulation (EU) 833/2014 and Regulation (EU) 269/2014. The measures were implemented in Council Regulation (EU) 2026/1848, Council Implementing Regulation (EU) 2026/1843, Council Regulation (EU) 2026/1844 and Council Decision (CFSP) 2026/1845, and were published in the Official Journal of the EU. The Council’s press release can be found here and FAQs issued by the European Commission can be found here.

The main development for members to note is that the EU has, for the first time, expanded the listing criteria to include vessels that service shadow fleet ships, whether or not those ships are themselves designated. More broadly, the package comprises 218 individual and entity listings, including 170 entities and 48 individuals. Those designations include 94 Russian banks and financial institutions, the largest number of designations in a single package in four years, together with a range of sectoral, trade, financial and anti-circumvention measures. The package builds on previous rounds by tightening maritime, energy and trading restrictions in ways that may affect vessel operations, cargo handling, chartering structures and counterparty screening.

Key takeaways for members

• Shadow fleet expansion: 41 additional vessels have been designated under Council Regulation (EU) 2026/1848, bringing the total number of sanctioned vessels to more than 670. For the first time under the widened criteria, this includes five bunkering tankers alleged to have regularly refuelled designated vessels.
• Cargo powers: EU member states may now confiscate and sell cargoes carried aboard detained shadow fleet vessels.
• LNG carrier sales: Owners must notify their EU member state of residence of any sale of an LNG tanker to a third country. The European Commission will review, by 25 October 2026, whether to introduce a full ban on the sale of LNG tankers to Russia. If such a ban is introduced, sellers would also have to take reasonable steps to ensure vessels sold to third countries are not resold or transferred to Russian interests, including through proxy ownership.
• LNG trade: A one-year, renewable exemption allows continued transport of Russian LNG to third countries under long-term contracts concluded before 24 February 2022, capped at 2025 volumes. All other previously agreed restrictions on Russian LNG, including the import ban from 1 January 2027, remain unchanged.
• Oil price cap: The automatic adjustment mechanism has been paused for 12 months, until 15 July 2027, keeping the price cap for Russian-origin crude oil at US$44.10 per barrel.
• Further transaction bans: The package adds two Russian ports, four Russian airports, a Georgian refinery and five oil traders, together with new designations of refineries in Russia and Belarus.
• Ship registry network: An individual identified as a central figure behind a network of fraudulent ship registries used to document ageing tankers engaged in Russian trades has been designated.

Shadow fleet and vessel designations

Forty-one additional vessels have been designated under Regulation (EU) 2026/1848, taking the total number of such vessels to more than 670. The new listings include non-EU tankers alleged to be circumventing the oil price cap, as well as vessels supporting Russia’s energy sector, transporting military equipment, or carrying grain removed from occupied Ukrainian territory.

Designated vessels remain subject to an EU port access ban and a prohibition on the provision of a broad range of maritime services, including insurance. They are also subject to a ban on ship-to-ship transfers and other cargo transfers involving such vessels.

For the first time, the designation criteria have been broadened to capture vessels providing support services, such as bunkering or ship-to-ship transfers, to the shadow fleet under Article 3s(2) of Regulation (EU) 833/2014, as amended by Council Regulation (EU) 2026/1848. On that basis, five bunkering tankers alleged to have regularly refuelled already-designated vessels have been listed.

Separately, eight entities and one individual have been designated in connection with the shadow fleet ecosystem, including a crewing agency alleged to have supplied personnel in support of sanctioned shipping operations.

A new rule allows EU member states to confiscate and sell cargoes carried by shadow fleet vessels that they detain.

Ship registries

The EU has designated an Indian national identified as the central figure behind a network of ship registries alleged to have supplied flag documentation to ageing tankers operating in Russian trades. The registries were reportedly linked to arrangements in Dominica, Guyana, Samoa, Micronesia, Eswatini and Laos.

Several flag administrations are reported to have withdrawn approvals or repudiated the arrangements, and the IMO has declared a number of the associated registrations fraudulent or invalid. Members are reminded of the importance of verifying the validity of a vessel’s flag and registry as part of their due diligence.

LNG measures

Owners must now notify the EU member state in which they reside of any sale of an LNG tanker to a third country, under Article 3qa. Under the legal text, the European Commission will review by 25 October 2026 whether to introduce a full ban on the sale of LNG tankers to Russia. If such a ban is introduced, sellers would also be required to take reasonable steps to ensure that vessels sold to third countries are not resold or otherwise transferred to Russian interests, including through proxy ownership.

A one-year, renewable exemption has been agreed, permitting EU operators to continue transporting Russian LNG to buyers outside the EU under long-term contracts concluded before 24 February 2022, provided annual volumes do not exceed 2025 levels under Article 3ra. The exemption is available to any EU operator meeting these criteria and is not limited to a single company.

All other previously agreed EU restrictions on Russian LNG remain unchanged, including the comprehensive ban on imports of LNG originating in or exported from Russia into the EU, which takes effect from 1 January 2027 for long-term contracts.

The EU has also clarified that the prohibition on the provision of LNG terminal services, introduced under the 20th sanctions package, applies not only to Russian and EU operators but also to non-Russian third-country operators controlled by Russian companies under Article 3rb.

Existing third-country exemptions have also been extended: the Sakhalin-2 exemption for Japan has been extended to 31 March 2028, and a new exemption has been granted to South Korea until the same date.

Oil price cap

To ensure that Russia’s profits from oil sales remain contained despite the exceptional market situation caused by the closure of the Strait of Hormuz, the package pauses the automatic six-monthly adjustment mechanism for the oil price cap, introduced under the EU’s 18th sanctions package, for 12 months until 15 July 2027 under Article 3n.

The suspension may be reviewed earlier if exceptional market developments occur. The price cap for Russian-origin crude oil remains at US$44.10 per barrel.

The legal basis for a full maritime services ban on vessels carrying Russian crude oil and petroleum products, established under the EU’s 20th sanctions package, remains in place, but no decision has yet been taken on activating it.

Port, refinery and trading transaction bans

Transaction bans have been extended to two further Russian ports, Olya and Vysotsk, and four Russian airports, in addition to the ports of Murmansk and Tuapse designated under the EU’s 20th sanctions package.

A transaction ban, subject to a six-month wind-down period, has also been imposed on a Georgian refinery at Kulevi engaged in the trading and processing of Russian oil.

Eighteen entities and one individual have been designated in the oil sector, including three refineries in Russia and a major Belarusian refinery, together with a company established to sell Belarusian petroleum products within Russia.

Transaction bans have also been imposed on five oil traders, including UAE-based Nexus Oil Trading, for allegedly frustrating the prohibition on purchasing Russian crude oil and petroleum products.

Other measures

The package also introduces a broad range of measures outside the primary scope of this circular, including expanded transaction bans and asset freezes affecting the Russian banking and crypto-asset sectors, further designations and export restrictions targeting Russia’s military-industrial complex, including components used in long-range drones, new import bans on certain metals and ores, measures mirroring the above in respect of Belarus, and enhanced legal protections for EU operators against Russian court judgments.

Members are reminded that cover is not available for any trade that breaches applicable sanctions. Members are advised to conduct thorough due diligence on the parties, cargoes, vessels and other service providers involved before engaging in any trade with a high sanctions risk. They should also keep records of their due diligence investigations and findings.

Source: Skuld