A Transformative Loophole: American Sanctions Fail to Screen Out Russian Origin Petroleum Products

The document contends that US sanctions on Russian fossil fuels are undermined by a 'substantial transformation' loophole. While E.O. 14066 bans Russian oil, it excludes goods that have been 'substantially transformed into a foreign-made product', such as crude oil refined into gasoline in other countries. The author highlights that India and the Netherlands export refined fuels to the US that may contain Russian-origin oil, thereby continuing to fund Russia's war in Ukraine. Global Witness calls for the US, UK, and EU to ban all refined fuels that may have been produced using Russian crude.

• US sanctions on Russian oil are bypassed because the US Treasury considers the refining of crude oil into gasoline to be a 'substantial transformation', which exempts the resulting product from the ban on goods of Russian origin.
• India has significantly increased its imports of Russian crude oil and subsequently exported refined fuels to the US; in June of the year of publication, India exported 2.7 million barrels of refined fuels to the US, with five of seven ships loading at Jamnagar port.
• The Netherlands also serves as a conduit for Russian-origin oil reaching the US; in June of the year of publication, the Netherlands imported over 16 million barrels of Russian crude and fuel oil and exported over four million barrels of diesel and gasoline to the US.
• Because petroleum products from different locations are mixed during the refining and storage process, there is no practical way to isolate or identify the original source of a specific gallon of gasoline.

APA

Global Witness (n.d.). A Transformative Loophole: American Sanctions Fail to Screen Out Russian Origin Petroleum Products. https://globalwitness.org/en/campaigns/fossil-fuels/a-transformative-loophole-american-sanctions-fail-to-screen-out-russian-origin-petroleum-products/

Chicago

Global Witness. A Transformative Loophole: American Sanctions Fail to Screen Out Russian Origin Petroleum Products. n.d. https://globalwitness.org/en/campaigns/fossil-fuels/a-transformative-loophole-american-sanctions-fail-to-screen-out-russian-origin-petroleum-products/.

Wikipedia

{{cite press release |author=Global Witness |title=A Transformative Loophole: American Sanctions Fail to Screen Out Russian Origin Petroleum Products |url=https://globalwitness.org/en/campaigns/fossil-fuels/a-transformative-loophole-american-sanctions-fail-to-screen-out-russian-origin-petroleum-products/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{globalwitnessndtransformative, author = {{Global Witness}}, title = {{A Transformative Loophole: American Sanctions Fail to Screen Out Russian Origin Petroleum Products}}, publisher = {Global Witness}, url = {https://globalwitness.org/en/campaigns/fossil-fuels/a-transformative-loophole-american-sanctions-fail-to-screen-out-russian-origin-petroleum-products/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }