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Russia-Ukraine War 2026
12OCT

Lukoil-ISAB sale licence runs to 27 June

2 min read
10:59UTC

General License 131F, which authorises only negotiation of the Lukoil-ISAB sale, runs to 27 June, keeping the Sicilian refinery's crude procurement under a sanctions overhang ten days after the GL 134C cliff.

ConflictDeveloping
Key takeaway

Two OFAC deadlines ten days apart turn late June into a concentrated squeeze on European crude access.

General License 131F, the OFAC authorisation governing the sale of the ISAB refinery by its sanctioned owner Lukoil, runs to 27 June. The licence permits only negotiation of the sale, not its completion, which leaves the Sicilian plant's crude procurement under a sustained sanctions overhang. ISAB is one of Italy's largest refineries; Lukoil is the Russian oil major that has owned it since 2008.

GL 131F lets the parties talk without letting money or assets change hands, a holding pattern rather than a resolution, so the refinery operates under the constant question of whether its ownership clears sanctions before the licence lapses. Procurement counterparties price that uncertainty into every cargo, which raises the refinery's effective crude cost regardless of the spot market.

The 27 June expiry twins with the GL 134C waiver cliff on 17 June, creating back-to-back sanctions deadlines that both tighten European-accessible crude inside a single fortnight. One governs whether Russian oil keeps flowing to Indian buyers; the other governs whether a major Mediterranean refinery's ownership stays in limbo. Together they make late June a concentrated test of how far the US will press the Russian-oil chokehold against European refining capacity.

Deep Analysis

In plain English

ISAB is a large oil refinery in Sicily, on the southern tip of Italy, owned by Lukoil, the Russian oil company. Because Lukoil is subject to US sanctions, ISAB has been operating under a series of temporary OFAC waivers that allow certain business activities to continue while a sale of the refinery is negotiated. The current waiver, called GL 131F, only permits negotiating the sale, not actually completing it. It expires on 27 June. If it is not renewed and no sale completes, the refinery faces a hard choice about what crude oil it can legally buy and how. ISAB processes crude from North Africa and the Middle East into petrol, diesel, and jet fuel for European markets, so its procurement constraints have real effects on Southern European fuel supply.

What could happen next?
  • Risk

    GL 131F expiry on 27 June without a renewal or a completed transaction licence would leave ISAB's 800kbd refinery in prolonged procurement limbo, forcing continued spot sourcing at elevated CPC/Augusta freight rates.

  • Consequence

    The back-to-back GL 134C (17 June) and GL 131F (27 June) deadlines create a ten-day window in which both Russian crude in-transit cover and ISAB sale negotiation authority simultaneously lapse, compounding European crude access uncertainty.

First Reported In

Update #6 · OPEC's quota is fiction at a 37-year low

OilPrice.com· 8 Jun 2026
Read original →
Different Perspectives
Government of Latvia
Government of Latvia
Latvia abstained on 22 September when the EU renewed its individual sanctions for 36 months at the price of delisting Alisher Usmanov and Mikhail Fridman, and promised national sanctions of its own. Riga's abstention marks how far a frontline member state will go to keep listed names listed.
India's Ministry of External Affairs
India's Ministry of External Affairs
After the House passed the Graham bill on 16 September, India's foreign ministry said it would keep buying energy on market terms and protect its trade. Russia supplied 30.3% of India's crude imports in fiscal 2026, so the tariff decision due around 18 October falls directly on New Delhi.
Kaja Kallas, EU foreign policy chief
Kaja Kallas, EU foreign policy chief
Kallas answered the US licence on 10 October by saying Europe would not ease pressure, and EU ministers adopted a 22nd package of nearly 1,600 listings two days later. Brussels is tightening as Washington loosens, though TASS reported the package adds no significant new trade restrictions.
Donald Trump and the US Treasury
Donald Trump and the US Treasury
The Treasury licensed Russian diesel imports until 7 April 2027 on the day of Trump's call with Putin, and Trump then told reporters Ukraine should find a new leader. Washington is trading sanctions relief for fuel supply while pressing Kyiv to halt the refinery strikes behind the shortage.
Kremlin and Deputy Prime Minister Alexander Novak
Kremlin and Deputy Prime Minister Alexander Novak
After the 9 October call the Kremlin said Russia was ready to supply oil and petroleum products to American and global markets, and Novak brought forward the end of diesel export curbs. Moscow is selling the shortage back as goodwill, with volumes that Decree No. 686 now hides from outside checks.
Volodymyr Zelenskyy, President of Ukraine
Volodymyr Zelenskyy, President of Ukraine
Zelenskyy called GL 135 an investment in prolonging the war and offered to stop striking Russian refineries if Russia stops destroying Ukraine's energy system. Answering Trump's call for a new leader, he set a total 60-day ceasefire as the condition for elections, which puts the next move on Moscow.