On November 14, 2025, a flurry of high-stakes political and economic maneuvering unfolded in Bulgaria and across Europe, as the United Kingdom granted a temporary exemption from its sanctions regime to allow the continued operation of the Lukoil-owned Burgas refinery and associated gas stations. This move, echoed by anticipated action from the United States, underscores the mounting pressure European governments face as they attempt to balance energy security with efforts to choke off financial flows to Russia amid the ongoing war in Ukraine.
The British Financial Sanctions Enforcement Office’s decision to issue special licenses to Lukoil Bulgaria EOOD and Lukoil Neftohim Burgas AD—valid until February 14, 2026—means that companies and banks can continue doing business with these entities and their subsidiaries, at least for the next three months. According to Reuters, the United States is expected to grant a similar exemption, a move that would further ease anxieties in Sofia about the looming threat of fuel shortages as winter approaches.
These developments come on the heels of sweeping sanctions imposed by Britain and the US in October 2025 on Russia’s two largest oil companies, Lukoil and Rosneft. The sanctions were designed to cut off the energy revenues that Moscow has been using to finance its invasion of Ukraine. The impact was immediate and far-reaching: Lukoil’s foreign energy empire began to unravel, with the seizure of its Bulgarian assets coinciding with the declaration of force majeure at its oil field in Iraq and layoffs at its trading division in Switzerland.
For Bulgaria, the stakes could hardly be higher. The country relies on the Burgas refinery—the largest in the Balkans and, since 1999, owned by Lukoil—for much of its fuel supply. As of November 2025, Bulgaria’s gasoline reserves could last about 35 days, and diesel supplies were sufficient for just over 50 days, according to Asen Asenov, director of the state reserves agency, as reported by BTA and Reuters. With winter looming and energy markets in turmoil, Bulgarian leaders have scrambled to secure exemptions from Western sanctions to keep the refinery running.
The British exemption coincided with a dramatic political decision in Sofia. On November 14, the Bulgarian government appointed Rumen Spetsov—director general of the National Revenue Agency and a former bodybuilding champion—as special commercial administrator to take control of Lukoil’s assets in the country. This followed a parliamentary vote on November 7 that authorized the government to seize the refinery and related assets, a move that gave the state sweeping powers over a critical piece of national infrastructure.
Economy Minister Petar Dilov defended the appointment, telling reporters, “Rumen Spetsov, whom I have nominated, meets all legal requirements.” Dilov emphasized that Spetsov would “ensure effective and lawful control over the body operating the critical infrastructure.” The new emergency law gives Spetsov the authority not only to ensure the continued operation of the refinery beyond November 21—when US sanctions are set to take effect—but also to sell shares to a new owner, pending government approval.
This extraordinary transfer of control has sparked fierce debate. Bulgarian President Rumen Radev, whose veto on the emergency law was ultimately overruled by parliament, warned that the measure undermined “the rule of law” and posed “an unreasonably high risk to public finances,” suggesting that Lukoil could sue Bulgaria and claim significant compensation. Opposition lawmakers, representing both pro-Russian and liberal factions, accused the government of preparing to transfer the refinery to a company close to the ruling coalition—a charge the coalition has firmly denied.
Moscow, for its part, has reacted with alarm. Russia’s ambassador to Sofia, Eleonora Mitrofanova, told TASS on November 10 that Bulgaria was “setting a dangerous precedent,” adding that the move “looks like a law on property expropriation.” The diplomatic tensions highlight the broader geopolitical stakes, as Europe’s efforts to wean itself off Russian energy collide with the practical realities of maintaining domestic fuel supplies.
Energy Minister Zhecho Stankov, speaking after a Security Council meeting, explained that the American and British licenses for Lukoil’s continued operations in Bulgaria would be conditioned on the assurance that money from the refinery’s activities would not flow to Russia. “The measures taken ensure that ‘in the shortest possible time,’ OFAC (the US Treasury’s Office of Foreign Assets Control) could issue a license that allows the refinery to operate after November 21,” Stankov said, as quoted by AFP.
To further safeguard domestic supplies, Bulgarian lawmakers last month adopted temporary restrictions on the export of petroleum products, including to other European Union members. The goal: to ensure that the country would not face shortages in the wake of US sanctions on Russian energy.
Meanwhile, the fate of Lukoil’s international assets remains uncertain. The company announced on November 14 that it was in “current negotiations with several potential buyers” about selling its foreign holdings. According to Reuters, US private equity fund Carlyle is considering making a bid, while the US government has already blocked an attempt by global trading house Gunvor to purchase Lukoil’s international assets.
Boyko Borisov, leader of the GERB party at the helm of Bulgaria’s ruling coalition, voiced cautious optimism about the prospect of a US exemption. “I hope that today we will get a derogation... for six months,” Borisov told BNR, Bulgaria’s national radio. The sense of urgency was palpable: without such exemptions, Bulgaria faced the prospect of a sudden and destabilizing shutdown of its only refinery.
For ordinary Bulgarians, the political wrangling and international chess moves may seem far removed from daily life. But the outcome will directly affect everything from the price at the pump to the stability of energy supplies through the coldest months of the year. The government’s emergency actions, the wrangling over ownership, and the scramble for new buyers all reflect the extraordinary pressures facing a country caught in the crosscurrents of war, sanctions, and energy insecurity.
As the dust settles, Bulgaria’s attempt to navigate these treacherous waters will serve as a test case for how smaller European nations can assert sovereignty over critical infrastructure while honoring international commitments. With the future of the Burgas refinery—and the broader energy landscape—still hanging in the balance, all eyes remain on Sofia, London, and Washington as the next chapter in this high-stakes saga unfolds.
