Reuters: Germany considers nationalization of Rosneft subsidiary after Trump’s sanctions

Germany has resumed discussions about potentially nationalizing Rosneft Deutschland, the German subsidiary of Russia’s Rosneft, according to two sources familiar with the matter, Reuters reported.

On October 29, the U.S. Treasury Department issued a license allowing Rosneft Deutschland to be exempt from U.S. sanctions until April 2026. The German government took the company’s assets under temporary trusteeship in September 2022 to ensure the country’s energy security. This interim arrangement is renewed every six months but can be challenged in court, as the legal basis for such measures is reviewed each time.

According to Reuters’ sources, Berlin still prefers a permanent sanctions exemption, but officials are also considering nationalizing the company and selling it to a foreign investor.

Rosneft Deutschland holds a controlling stake in the Schwedt refinery, which supplies most of Berlin’s fuel — including for the city’s airport, gas stations across eastern Germany, and key inputs for the chemical industry. The company also owns shares in the MiRo and Bayernoil refineries.

Until now, Berlin has refrained from confiscating Rosneft’s assets due to concerns about potential compensation claims from Moscow.

Russian media estimate Rosneft’s German assets to be worth around $7 billion, though one source told Reuters the real value could be less than half that amount.

Rosneft Deutschland now purchases oil from Kazakhstan, not Russia as before, but the crude is still transported via the Russian Druzhba pipeline.

According to Bloomberg sources, the U.S. has given Germany only six months to resolve the issue of Rosneft’s asset management.

• In February 2024, Reuters, dpa, and Handelsblatt reported that the German government was preparing to nationalize Rosneft Deutschland, but the plan was not implemented.