Russian oil major Lukoil has agreed to sell its foreign assets to US private equity firm Carlyle. The transaction, announced by Lukoil on January 29, is the result of US and UK sanctions imposed in October 2025 and could significantly alter fuel supply chains and ownership structures across Bulgaria, Romania and Serbia.

The deal centres on Lukoil International GmbH, a Vienna-based, a subsidiary that manages the group’s overseas assets, excluding Kazakhstan. These international holdings are estimated at around $22bn, according to Reuters. Assets in Kazakhstan will remain under Lukoil’s ownership and continue operating under existing licences.

Lukoil’s move follows months of failed attempts to divest its foreign operations. Previous efforts to sell to Switzerland’s Gunvor or to pursue a share swap with Xtellus Partners were blocked by the US Treasury’s Office of Foreign Assets Control (OFAC). With sanctions restricting access to capital markets and complicating operations, Lukoil’s remaining viable option has been to sell its non-Russian assets to a US-approved buyer.

Carlyle, headquartered in Washington and managing around $474bn in assets globally, fits that requirement. For the US, the transaction would replace Russian ownership with a Western firm that has a clean sanctions profile, while reducing Moscow’s influence over strategically sensitive energy infrastructure.

The most important asset in the Balkans is Lukoil Neftochim Burgas, Bulgaria’s largest refinery and the biggest in the region. Established in 1998, the Burgas refinery has a capacity of 6.8m tonnes per year and supplies fuel not only to Bulgaria but also to Romania and Serbia. Lukoil’s Bulgarian operations also include 220 fuel stations, accounting for around 20% of domestic fuel sales, as well as aviation and marine fuel businesses. Lukoil Neftochim Burgas reported revenue of BGN 9.1bn (€4.65bn) in 2024, making it Bulgaria’s largest company by turnover.

Although Bulgaria stopped importing Russian crude oil in March 2024 after a gradual phase-down, the refinery has continued to process non-Russian oil sourced from countries such as Kazakhstan, Iraq and Tunisia, using Lukoil’s infrastructure and logistics.

Following the imposition of US sanctions, Sofia moved quickly to insulate the refinery from legal and operational risks. In November, parliament amended legislation to allow the state to appoint a special administrator to manage the facility, paving the way for a potential sale. Former National Revenue Agency head Rumen Spetsov replaced Lukoil’s Moscow-appointed chairman as administrator, effectively placing the refinery under state oversight.

These measures were taken amid political instability. Bulgaria’s government has since collapsed following anti-corruption protests, and a caretaker administration has yet to assume power. Despite this, there is broad political consensus on reducing dependence on Russian-controlled energy assets.

In Romania, Lukoil operates around 320 fuel stations and owns the Petrotel refinery, the country’s third-largest. Petrotel supplies roughly a quarter of Romania’s fuel needs and also holds offshore exploration rights in the Black Sea.

Romanian authorities have signalled that, as in Bulgaria, greater state oversight of Lukoil’s local operations may be required to safeguard energy security and employment. A sale to Carlyle would likely be viewed favourably by policymakers, as it would remove sanctions-related risks and ensure continuity of supply under a Western owner.

Serbia’s oil market is particularly exposed to sanctions-driven change. Lukoil is the country’s second-largest fuel retailer, operating 112 stations. Together with the sanctioned-Oil Industry of Serbia (NIS), it accounted for nearly one-third of Serbia’s retail motor fuel market in 2024.

NIS is majority-owned by Russia’s Gazprom and Gazprom Neft and is itself subject to US sanctions. Last week, Hungary’s MOL announced plans to acquire a majority stake in NIS from Gazprom Neft, a transaction that also requires US approval. If completed, this would further reduce Russian ownership in Serbia’s oil sector.

As a result, Serbia’s downstream oil market is effectively waiting for decisions in Washington. While the country remains heavily reliant on Russian gas under long-term supply agreements, a restructuring of its oil sector would nonetheless diminish Moscow’s economic and political leverage.

If completed, Carlyle’s acquisition of Lukoil’s foreign assets would represent a significant US-driven realignment of Balkan energy infrastructure. The immediate benefits would be a reduction of geopolitical risk, compliance pressure due to sanctions, greater supply stability and clearer ownership structures for critical assets.

For the US, the deal aligns sanctions policy with strategic objectives, replacing Russian control with a Western, OFAC-compliant owner in a region where energy security is closely tied to political stability. For Bulgaria, Romania and Serbia, it offers a path towards more predictable fuel supplies and reduced exposure to geopolitical shocks.