UK allows some continued Russian LNG trade into Japan, South Korea under sanctions

The UK has carved out a temporary sanctions exemption to allow UK involvement in some Russian LNG trade into Japan and South Korea through March 2028, the country's Department for Business and Trade and Office of Trade Sanctions Implementation said Oct. 1.

Previous UK sanctions are set to ban UK involvement in the maritime transit of all Russian LNG from the start of 2027.

Under the new general trade licenses, though, UK market participants can remain involved in trade to South Korea and Japan if the imports are from the Sakhalin 2 LNG project in Russia's Far East and under a contract concluded before June 17, 2025.

The carve-outs run through March 31, 2028.

The government said the measures are to allow the "continued energy security" of both countries as they lower reliance on Russian imports.

"This is not a loosening of existing sanctions," the UK government said Oct. 1. "The license reflects existing arrangements and does not authorize trade with designated persons or LNG trade under new contracts."

The move aligns with a similar carve-out around Russian LNG imports into Japan and South Korea under the EU's sanctions regime.

So far this year, Japan and South Korea have imported a total of about 4.8 million metric tons of LNG from Sakhalin 2, according to data from S&P Global Energy CERA. This accounted for some 5.9% of the two countries' total year-to-date imports.

Asian LNG prices remain elevated amid the sustained disruptions linked to the war in the Middle East.

Platts, part of S&P Global Energy, assessed the JKM benchmark for LNG delivered into Northeast Asia at $25.48/million British thermal unit on Oct. 1, up 4.9% day over day.

More blacklisted LNG ships

Separately, the UK's Foreign, Commonwealth and Development Office on Oct. 1 imposed sanctions on eight more ships it says are likely involved in transiting Russian LNG.

The ships are the Chaivo, Portovyy, Aleksey Kosygin, Konstantin Posiet, Pyotr Stolypin, Bebek-E, Avacha, and Galle Energy.

The FCDO also sanctioned an entity called Novatek Gas and Power Asia Pte Ltd, citing likely involvement in the Russian energy sector to the benefit of the Russian government.