What changed in OFAC GL 131I

On August 20, 2026, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License No. 131I under the Russian Harmful Foreign Activities Sanctions Regulations (RuHSR), 31 C.F.R. part 587.

We compared the texts line by line. Exactly one thing moved: the date. The authorization now runs through 12:01 a.m. Eastern Daylight Time on September 19, 2026, rather than August 22 in paragraph (a), covering negotiations, and in paragraph (b), covering maintenance and wind-down. Everything else is identical.

The authorized perimeter is unchanged. Permitted are transactions ordinarily incident and necessary to negotiating and entering into contracts with Public Joint-Stock Company Oil Company Lukoil or any of its affiliates for the sale, disposition, or transfer of Lukoil International GmbH (LIG) and any entity in which LIG holds, directly or indirectly, a 50 percent or greater interest, provided performance of any such contract is expressly contingent on receipt of a separate OFAC authorization. Maintenance and wind-down of LIG entities’ operations are separately authorized, and the blocked accounts of those entities may be used, debited, and credited for that purpose.

The three carve-outs are also untouched. OFAC GL 131I does not unblock property blocked under any part of 31 C.F.R. chapter V, except for the blocked-account activity the license itself permits; it does not authorize other transactions prohibited by the RuHSR, including dealings with blocked persons other than those named in the license; and it does not authorize the transfer of funds to any person or account located in the Russian Federation.

OFAC GL 131I is the tenth document in the series and the ninth consecutive extension: the original GL 131 was followed by 131A through 131H and now 131I. The negotiation window opened in November 2025 has been rolled forward nine times without once becoming an authorization to close.

London went the other way: six months and a new duty to notify

The more interesting development came eight days earlier, on the other side of the Atlantic.

On August 12, 2026, the UK Treasury’s Office of Financial Sanctions Implementation (OFSI) amended both of its Lukoil general licenses. License INT/2025/8031092, permitting continued business operations with Lukoil International entities, was extended by six months to February 26, 2027. License INT/2025/7895596, covering Lukoil’s Bulgarian entities, was extended to October 29, 2026, deliberately aligned with the U.S. GL 128C covering Lukoil’s retail service stations.

Both licenses also acquired a requirement that did not exist before. An entity relying on either license must notify OFSI and supply current contact details. Anyone beginning to use a license on or after August 12, 2026, must notify within 14 days of first use; anyone already relying on it must notify within 14 days of August 12. For existing users, that deadline falls on August 26, 2026.

The notification is one-off and repeats only if contact details change. OFSI states plainly that submitting it is not confirmation by HM Treasury that the activity in question is permitted under the license. The amendments also revised the definition of a Lukoil International subsidiary and introduced the concept of an “Entity” – a person who is neither an individual nor a relevant UK financial institution.

The contrast with Washington is instructive. The United States grants thirty days and imposes no registration duty. The United Kingdom grants half a year but requires the users of its license to identify themselves. These are two different techniques for keeping hold of the same process, and any company operating across both jurisdictions now has to run two separate calendars.

The asset keeps changing while the license keeps renewing

Nine extensions have moved more than the clock. They have moved the subject matter of the negotiation.

Lukoil has fully written off its investment in Lukoil International, recognizing a loss on the disposal and impairment of foreign assets of 1.667 trillion rubles. Its 2025 IFRS net loss came to 1.06 trillion rubles, against a net profit of 851.5 billion rubles the year before. In accounting terms, the Russian owner has already said goodbye to the asset, while legally retaining title; expressly, as the report puts it, for the purpose of selling, disposing of, or transferring it. That is perhaps the cleanest illustration of what blocking actually does: title survives, economic value to the titleholder does not.

Nor is the write-off final. The report states plainly that events in the following financial year (OFAC decisions and completion of the Lukoil International sale in particular) could lead to a partial reversal of the impairment. Which is to say the fate of 1.667 trillion rubles turns on precisely the separate authorization OFAC has withheld through nine consecutive extensions.

The single largest foreign asset has effectively left the perimeter. In Iraq, Lukoil held a 75 percent interest in West Qurna-2, one of the world’s largest fields, producing around 470,000 barrels per day: roughly 0.5 percent of global supply and about 9 percent of Iraqi output. Lukoil declared force majeure there in November 2025 after payments under the project stopped.

On January 7, 2026, Iraq’s cabinet invoked the provisions of the service contract and transferred operations at the field to the state-run Basra Oil Company for twelve months. The press called this a nationalization, but the label is inaccurate, and Iraq publicly disputed it. The field has always been state-owned; Lukoil served as operator under a service contract, producing oil for a fee, and Basra Oil Company itself holds the remaining 25 percent. This was not an expropriation but the exercise of a right written into the contract; a distinction that matters, not least for any prospect of investment arbitration. In February 2026, the cabinet approved an amicable settlement with Lukoil formalizing the transfer and resolving outstanding invoices and the employment of foreign personnel.

Lukoil has not left Iraq altogether: it retains a 60 percent interest in Block 10, which includes the Eridu field. Roughly a dozen investors were reported interested in the West Qurna-2 stake, among them Exxon Mobil, Chevron, and Carlyle.

Kazakhstan was carved out of the Carlyle transaction from the start, as Lukoil said at the time. In Bulgaria, the Neftochim Burgas refinery operates under an externally appointed administrator, and Turkey’s Cengiz Holding and Azerbaijan’s SOCAR have been reported as interested on a track separate from the LIG perimeter.

The buyer is not settled either. The agreement with U.S. investment firm Carlyle, announced on January 29, 2026, was expressly non-exclusive, and Lukoil said it would continue talks with other potential purchasers. Chevron and Exxon have been reported as interested, and Carlyle has been reported to be in preliminary discussions with UAE investors about a possible partnership.

What OFAC will require of any eventual sale

FAQ 1224 remains the operative document for any buyer. OFAC sets out the minimum conditions on which it would even consider a separate authorization to effectuate a sale: a complete severance of LIG’s ties with Lukoil; blocking any funds owed to Lukoil by placing them in an account subject to U.S. jurisdiction until sanctions are lifted; and no windfall to Lukoil, in particular no up-front value including through asset or share swaps. OFAC further expects any future license to require a purchaser to seek its review before further divesting material LIG assets.

The same FAQ preserves OFAC’s right to revoke the license at any time, including if it concludes that Lukoil and LIG are not negotiating in good faith. An extension is neither a guarantee nor a promise: the window stays open precisely as long as OFAC considers it useful.

Practical takeaways

• There are now at least four calendars, and they do not line up: OFAC GL 131I runs to September 19, 2026; GL 128C, covering Lukoil retail stations outside Russia, to October 29, 2026; the UK license for Lukoil International entities to February 26, 2027; and the UK license for the Bulgarian entities to October 29, 2026. Operating under an expired license is a violation, not a filing lapse.
• If your organization relies on either UK Lukoil license, the OFSI notification is due by August 26, 2026. Filing it does not validate your activity; assessing compliance with the license terms remains your own responsibility.
• The contingency clause is mandatory. Any agreement concluded in reliance on the 131 series must expressly condition performance on receipt of a separate OFAC authorization. A contract without it falls outside the license.
• No funds move to Russia under any circumstance. The prohibition on transfers to any person or account located in the Russian Federation appears in every license in the series without exception.
• Non-U.S. persons may rely on the series, but only within its terms. Whether a foreign financial institution maintains blocked accounts is not the question; compliance with the license conditions, including the ban on payments into Russia, is.

Nine extensions are not bureaucratic drift; they are a position. OFAC keeps the negotiation open without authorizing performance, while watching the perimeter of the asset change without its involvement: Iraq takes over operations, Bulgaria appoints an administrator, the buyer looks for partners. OFAC GL 131I extends not the transaction but the ability to negotiate one. Those are different things, and the distance between them is what the whole series has cost.