Processed Russian Oil Products: Sanctions

12.39 pm

(Urgent Question): To ask the Secretary of State for Business and Trade to make a statement regarding the Government’s decision to issue general trade licences for sanctioned processed oil products prohibited under the Russia (Sanctions) (EU Exit) Regulations 2019.

Putin must never be allowed victory in Ukraine and we will do everything we can as a Government and a country to debilitate and degrade the Russian war machine. That is precisely what our sanctions regime is designed to do. We have sanctioned more than 3,300 individuals and organisations and hundreds of shadow fleet tankers. It is as tough a sanctions regime as any in the world, and we are proud of it.

I want to make it absolutely clear that our sanctions regime today is tougher than it was yesterday or last week. In fact, thanks to the Russia (Sanctions) (EU Exit) (Amendment) Regulations 2026 statutory instrument, we will from today for the first time—for the first time—ban the import not only of uranium but of Russian oil products processed in a third country. We are not lifting any existing sanctions at all. We are, like other countries, phasing in these sanctions, which is why, in the light of the situation in the middle east, we have issued a targeted temporary licence to allow the continued import of diesel and jet fuel. These licences are temporary and targeted. We will review them regularly and repeatedly, and will suspend them as soon as we possibly can.

As a result of all the measures that we have taken, there will be less Russian oil on the market, not more, Russia will be poorer, not richer, and Putin will be weaker, not stronger.

In their 18th packet of sanctions in January this year, His Majesty’s Government prohibited the import of Russian petroleum products produced in third countries from Russian oil, obliging importers to provide proof of the origin of oil used in petroleum product production. Yet yesterday evening at 7 pm, while we in this very Chamber were debating the future of our own North sea oil and gas industry and Labour MPs were being whipped to vote against new oil and gas licences in the North sea, the Government slipped out an announcement that the general trade licence for sanctioned processed oil products now permits certain activities prohibited under the Russian sanctions regulations 2019, such as the import of diesel and jet fuel to the UK. At the exact same time that this Government have rolled back on their commitments to Ukraine and given the green light to purchase Russian oil from third countries, they were whipping their MPs to vote to shut down our own oil and gas production. It is an absolute disgrace. They should all be utterly ashamed of themselves.

What message does this send to the international community, to the people of Ukraine, and to workers in our North sea oil and gas industry, which is being crushed by the misguided eco-zealotry of the Secretary of State for Energy Security and Net Zero? We are not only rewarding the thuggish and criminal behaviour of the Russian state, but punishing ourselves and the skilled workforce in the United Kingdom.

First, I think the hon. Member must have missed the fact that a statutory instrument that, for the first time, implements a ban on refined Russian crude oil products processed in a third country is coming into force today. It did not come into force earlier in the year. Incidentally, it did not come into force when he was in government, because when the Conservatives were in government, they allowed such oil products to come into the UK, and he personally did absolutely nothing about it.

The truth is that both sides of the House agree and, in fact, I think all parties in the House agree—well, we have not heard from Reform yet—that we need to make sure that Putin does not prosper. One of the key ways of doing that is making sure that we tackle the shadow fleet, which we have been doing very successfully. More than 500 tankers have been disrupted, and $1.6 billion less oil will be transported this year than last year because of those sanctions.

To be precise on the hon. Member’s question of whether we will review the licences, I have already said we will review the licences. They are there for a very simple reason, which is that, just as the previous Government nearly always introduced sanctions in a phased way when he was a Minister, that is precisely what we are doing with these sanctions on oil products processed in a third country. We are doing the right thing, and I would have thought that he would want to praise us. Unfortunately, I think he has tried to find a political headline rather than look into the facts.

This package of sanctions has come to us very quickly, and I am slightly concerned about how it has been communicated today, so a bit of clarity would be really welcome. How long will the regulations made under the Sanctions and Anti-Money Laundering Act 2018 stand prior to completing the phasing in of the new package of sanctions? Will there be a gap, or will we immediately turn to the new sanctions and implementation of the sanctions regime?

There are two things here. A set of sanctions comes into force today, including on oil and oil products processed in a third country. It is the first time that the UK has gone down that route. As I say, the previous Government chose not to go down that route, even though people were arguing for it. I think this will be an important new measure in ratcheting up the pressure on the Russian regime.

At the same time, partly in recognition of the instability there may be in the energy markets as a result of the events in the middle east and the war in Iran—obviously, we have chosen not to take part in it—we have decided to implement these sanctions in a phased way, as many other countries have done, including Australia and Canada. That is why we have introduced these licences for diesel and jet fuel. As I have said, I want these licences to last as short a time as is possible and necessary to manage that market instability, and that is why we will review them as much as possible.

I pay tribute to my hon. Friend as our trade envoy to Ukraine. We stand 100% beside our friends in Ukraine. Indeed, the package of sanctions we have introduced this time around is the toughest of any, and I know our Ukrainian friends have supported them.

I call the Liberal Democrat spokesperson.

Inconsistencies and U-turns have become characteristic of this Government, but this is more than just a redirection of policy; this is a betrayal of Ukraine. This Government are abandoning our European ally in its moment of need by putting more money into the pockets of President Putin to fund his war machine.

Last month, the Liberal Democrats urged the Government to implement a bold plan to keep Britain moving, which included a 10p cut to fuel duty, but also featured proposals to boost public transport by slashing bus fares to £1 and cutting rail fares by 10%. This would have taken pressure off our forecourts, but the Government sat on their hands. Instead, the Government believe that our best course of action is to abandon all morality and to indirectly fund Putin’s illegal war. I would like to ask the Minister how much money will be spent on Russian oil products as a result of this decision, and will he admit that lifting these sanctions will indirectly fund Russia’s invasion of Ukraine?

I am sorry, but I do just need to explain to the hon. Lady that we are not lifting any sanctions. We are implementing new sanctions, which only come into force today. Up until now, it has been perfectly legal to import Russian oil products processed in a third country into the UK—up until now. It is only now, because of this Government, with the new sanctions that come into force today, that that will not be possible. I really do hope that the hon. Lady will withdraw her comments.

The whole of this House stands 100% beside Ukraine. I myself am probably the longest standing critic of Putin in this House. Back in 2014, when others were in government and not doing anything about the invasion of Crimea, I was saying that we should be tackling Russian aggression, because otherwise, if Putin was allowed to take Crimea with impunity, he would come for the rest. I do recognise that Liberal Democrat Members have been calling in the Business and Trade Committee and elsewhere for us to tackle precisely this issue of Russian crude oil processed in other countries that ends up coming into the UK. Up until now, that has been a source of income for Putin, but we are the Government who are stopping this, not enabling it.

I am grateful for the clarity my hon. Friend provides for us on this issue, because it has been of extreme concern for a number of colleagues. Does he think that wider global insecurity around energy requires global co-operation and collaboration, and that the UK Government could lead on that? We are hosting the G20 next year. In the process of building up to that, could we consider ensuring that global energy security is the priority for the G20 summit?

My hon. Friend makes an immensely important point on energy security, which is one reason why we are passionately committed to trying to make sure we are not reliant on oil or oil products from anywhere else in the world, and that we are able to not only meet our net zero targets, but be energy resilient for ourselves. She is also right that we need to work alongside our allies, not only—I would argue—on energy security but in relation to imposing sanctions. We must co-operate with other countries. As I say, our set of processes is remarkably similar to those of Australia, Canada—I think—and several other countries. We need to move forward together if we are to defeat Putin and to ensure we have energy security for our own households and our own businesses.

I pay tribute to the Minister, who has been tough on Russia for many, many years. He is sanctioned in Russia, as am I, and we have both previously chaired the all-party parliamentary group on Russia, so I know today’s announcement will sit uncomfortably with him. I welcome the new sanctions through third countries, but I am very concerned—there will be more concern in Kyiv, quite frankly—about what he calls temporary licences. How long is “temporary”? Unfortunately, this money, through these imports, will continue to fund Putin’s illegal war machine against Kyiv. It will kill women, children and men. While the Government are denying a licence to drill in the North sea, they are, unfortunately, giving Putin a licence to kill.

As it happens I am not on the Russian sanctions list, although when I raised this with the Russian—

You are now!

I think I might be on the right hon. Lady’s sanctions list! But in actual fact, when I raised this with the Russian ambassador—I was a bit upset—he said, “Well, we have many lists, Mr Bryant.” I do not know whether I am on a target list, which is maybe slightly different.

I am not ashamed of what we are doing today. As a very stout defender of Ukraine’s right to defend itself, and as somebody who argued for a very long time that we should be trying to make sure that Russian frozen assets were made available to Ukraine, I am proud of what we are doing, because we are introducing a tougher sanctions regime. The only bit we have had to take cognisance of is the fact that the situation in the middle east means that there was a danger of a sudden spike in prices and we had to address that. I very much hope that this will be a very temporary measure. I will be keeping a very watchful eye to make sure that we are able to suspend the licences as soon as we possibly can.

I thank the Minister for coming to the Chamber to answer this really important urgent question. He will know that we must keep at the forefront of our minds our allies in Ukraine who have been fighting this terrible illegal war for many years. I am proud that many of my constituents took in many people from Ukraine at the start of the invasion. Echoing the comments made by my hon. Friend the Member for Leeds Central and Headingley (Alex Sobel), I am concerned about the communication around this issue. A constituent contacted me and said:

“I am one of your constituents and have never had reason to contact you. However, on awaking this morning I am both angry and ashamed by the announcement, snuck out last night, that your government is (partially) lifting sanctions on the purchase of Russian oil.”

Can the Minister reassure me and my constituents that this will be a temporary measure, similar to the sanctions restrictions put in place by the Americans? My understanding is that they will be there for 30 days.

Mr Speaker, you will be aware of the phrase that sometimes it is conspiracy and sometimes it is something else. I just want to say that, in relation to communications, there is no conspiracy. Nobody is trying to undermine our support for Ukraine. The statutory instrument on the tougher measures was always going to come into force today. Up until today it was perfectly legal to import Russian products that had been refined in third party countries into the UK. It will no longer be legal to do so. There are several categories under that which will be banned. For instance, it will tackle carbon fibre used in the production of Russian drones, chemicals used in precision missiles, and goods used in emerging technologies such as quantum computing and AI. I want to ensure that these licences will be as temporary as possible. In 2022, along with the Foreign Affairs Committee, I visited Kyiv and Avdiivka, right at the very edge, roughly a fortnight before the full-scale invasion. We saw Russian troops and snipers pointing at Ukrainians. This battle has gone on since 2014, not just since 2022. I can assure my hon. Friend that the British Government stand 100% beside the Ukrainian people.

For years, Ministers on the Treasury Bench have told us that oil is traded as a global commodity, so it makes no difference where in the world it is taken out of the ground and that, as a consequence, we can wind down production on the UK continental shelf—availability of supply would continue. Given what the Minister has had to announce today, is he satisfied that that argument still holds water?