US sanctions Rosneft and Lukoil after Trump cancels Budapest summit with Putin

The US Treasury Department on Wednesday announced sanctions against Russia’s two largest oil companies, Rosneft and Lukoil, as US President Donald Trump confirmed that his planned summit with Vladimir Putin in Budapest would not go ahead.

A statement on the Treasury Department website said the sanctions were “as a result of Russia’s lack of serious commitment to a peace process to end the war in Ukraine” and aimed to “degrade the Kremlin’s ability to raise revenue for its war machine and support its weakened economy”.

Treasury Secretary Scott Bessent said the measures were a response to Vladimir Putin’s “refusal to end this senseless war”, and that the Treasury would take “further action if necessary” to force Russia to engage in peace talks in good faith.

“We encourage our allies to join us in and adhere to these sanctions”, Bessent added.

While Trump has repeatedly threatened economic action against Russia over its refusal to agree to a ceasefire in Ukraine, he appeared to shift his stance again after a call with Putin last week, announcing that he would meet the Russian leader in Budapest within two weeks and refusing the transfer of long-range Tomahawk missiles to Kyiv.

Wednesday’s sanctions, however — the first imposed on Moscow by the Trump administration since his return to office in January — mark the latest reversal in the US president’s position on the war.

During a meeting with NATO Secretary General Mark Rutte at the White House later on Wednesday, Trump said it was “time” to impose sanctions on the two oil giants, which are estimated to account for almost half of Russia’s total crude oil exports.

“These are tremendous sanctions,” Trump told reporters in the Oval Office. “Those are against their two big oil companies, and we hope that they won’t be on for long. We hope that the war will be settled”.

The US president added that he had cancelled his upcoming meeting with Putin in the Hungarian capital as it “didn’t feel right” to him, but stressed that he still intended to meet with the Russian leader “in the future”.

“It didn’t feel like we were going to get to the place we have to get, so I cancelled it,” Trump said. “Every time I speak to Vladimir, I have good conversations and then they don’t go anywhere”.

After meeting with US Secretary of State Marco Rubio on Wednesday, Hungarian Foreign Minister Péter Szijjártó insisted Washington had “not given up” on hosting the summit in Budapest.

“Preparations are ongoing and the only question is timing, not intention,” Szijjártó wrote on X.

On Thursday, European Commission Vice President Kaja Kallas also announced the EU’s long-awaited 19th sanctions package against Moscow, which she said would target “Russian banks, crypto exchanges [and] entities in India and China” and restrict the movement of Russian diplomats.