The UK said it stood firm on Russia. Then it loosened some rules.
The trade minister is now apologizing in Commons, while the EU signals it has no plans to follow.
What The Licenses Do
The licenses carve out two parts of the UK's Russia sanctions rules.
UK firms can now bring in fuel made from Russian crude in third countries like India or the UAE.
Some services tied to ships moving Russian LNG can also keep running. LNG is short for liquefied natural gas.
Trade Minister Chris Bryant called the rollout "clumsy" in front of MPs. He said the government will revise the licenses "as soon as possible." He told the chamber the carve-outs should be as "temporary as possible."
The official reason: supply. Officials said a clean break would have hit UK fuel supply hard, with the Strait of Hormuz just closed.
The mix-up came from a gap between the trade office and the foreign office.
The UK first sanctioned Russian oil and gas in 2022. That came after the Ukraine invasion. The rules have been tightened since.
The new licenses pull back some of those rules. They do not let in raw Russian crude. They only cover fuel made from Russian crude in a third country, plus some ship services.
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Why The Timing Is Drawing Fire
The same week the licenses went out, the UK voted down a bid to grow North Sea drilling. That gave critics on the left and the right a clean contrast to point at.
Brussels added pressure. EU officials said the bloc will stand firm on Russia. They have no plans to mirror the UK's move.
PM Keir Starmer defended the licenses. He called them a short-term step to protect UK buyers. He said the move does not lift the wider UK sanctions on Russia.
What Investors Are Watching
Bryant said the licenses will be reworked. He did not give a date for the new draft.
Three things matter for markets:
- UK energy stocks. Tighter terms could pull Russian-origin fuel out of the UK system. Looser terms could keep it in.
- Refined product spreads. Diesel and jet fuel margins move on the crude mix at UK and EU refineries.
- Shipping insurance. Carve-outs for Russian LNG ships change which insurers can cover which routes.
BP and Shell run UK refineries on mixed crude, while UK utilities with LNG ties should also track the wording closely.
Energy stocks rose on the day of the apology. Traders read the move as a sign that rules could relax, while Brent crude held steady.
The next steps depend on what the revised licenses actually say, and Bryant has not set a date.
The official line is that the licenses are short-term.
The market has taken the apology in stride so far.
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