UK targets Russian oil trade in expanded sanctions, China’s Shandong Yulong named

The United Kingdom has tightened its sanctions on Russia’s energy sector, imposing new measures against state oil giants Rosneft PJSC and Lukoil PJSC, as well as several Indian and Chinese firms accused of facilitating the continued trade of Russian crude and gas despite existing restrictions.

The latest move represents one of London’s most assertive efforts yet to choke off revenues to the Kremlin amid the ongoing war in Ukraine. The updated sanctions also target a network of tankers operating within Russia’s so-called “shadow fleet,” which is accused of concealing the origin and movement of sanctioned oil.

Among those blacklisted is Shandong Yulong Petrochemical Company, one of China’s largest independent refiners with a crude processing capacity of 400,000 barrels per day. The UK government cited Yulong’s dealings with previously sanctioned vessels and entities involved in transporting Russian-origin crude, describing the firm’s activities as strategically significant to Moscow’s energy trade.

Yulong operates an integrated petrochemical complex in Yantai, producing around 1.9 million tons/year of PP, 1 million tons/year of HDPE/LLDPE, and 0.7 million tons/year of HDPE. These units were commissioned in phases from early 2025, with the company recently gaining traction in export markets.

Market participants told CommoPlast that the sanctions could prompt both Chinese and overseas buyers to adopt a more cautious stance towards Yulong’s cargoes until there is greater clarity on enforcement. Some sources suggested the producer may scale back operating rates significantly, although this could not be independently confirmed.

The updated UK sanctions also encompass 44 vessels identified as part of Russia’s expanding shadow fleet. The government said the move was aimed at restricting the use of British-based financial, insurance, and maritime services for ships involved in Russian oil transport.

While the effectiveness of London’s latest measures remains uncertain, the inclusion of major Chinese and Indian refiners underscores a growing divide between Western economies seeking to isolate Russia and Asian buyers maintaining access to its discounted energy supplies.

Written: Aiman Haikal