Lukoil Faces Global Challenges Amid U.S. Sanctions

Lukoil, Russia's second-largest oil producer, is struggling with distribution issues due to U.S. sanctions. The sanctions have affected its international assets across Europe, Central Asia, the Middle East, and the Americas. The firm is now facing operational and transactional difficulties in key regions including Iraq, Egypt, Kazakhstan, and the United States.

Lukoil, Russia's second-largest oil producer, is contending with significant disruptions to its international operations following U.S. sanctions. These sanctions, coupled with Washington's denial to authorize an asset sale to Swiss trader Gunvor, are impacting Lukoil's extensive global operations.

The company, which produces half a million barrels of oil daily outside Russia—equivalent to 0.5% of global output—has operations in regions such as Iraq, Kazakhstan, and Azerbaijan. In the Middle East, Lukoil holds significant stakes in the West Qurna 2 oilfield in Iraq and other projects across Egypt and the UAE.

Despite challenges, Lukoil maintains a broad international footprint with refining and retail operations in Bulgaria, Romania, and the Netherlands, and a robust retail presence in countries like Turkey and Moldova. However, fuel and cash flow impediments linked to sanctions are causing operational strains.

(With inputs from agencies.)