Abstract
Following the Russian invasion of Ukraine, Türkiye has emerged as a pivotal enabler of Russia’s sanctions evasion by serving as a critical hub for laundering oil, gas, and dual-use goods. By exploiting regulatory loopholes, Türkiye has facilitated the continued flow of Russian energy into Europe, undermining the EU’s decoupling strategy and weakening the integrity of Western sanctions. Turkiye’s unique geopolitical position has allowed it to strengthen economic ties with Russia while still selling energy to the EU. To decrease this threat to the EU’s energy security and increase the impact of sanctions, the EU needs to take decisive action to close these laundering networks.
Introduction
The Russian invasion of Ukraine in February 2022 exposed the profound energy security vulnerabilities facing the EU. One approach to countering the energy crisis that ensued was for the EU to begin an unprecedented effort to strategically decouple from its dependence on Russia. The EU has banned the import of coal and oil from Russia and proposed an ambitious roadmap to phase out Russian natural gas supply by the end of 2027.
Nonetheless, there are glaring loopholes in the EU embargo that have allowed Member States to continue buying, directly and indirectly, Russian crude and petroleum products – to the tune of $20 billion per year. There is a specific exemption in the EU ban that allows landlocked Central European countries including Hungary, Slovakia, and Czechia to import Russian oil via the Druzhba pipeline (CSD, 2025b, 2025c). In addition, EU companies can legally buy refined products made from processing Russian crude oil in third countries.
Türkiye has been one of the biggest beneficiaries of the refining loophole, making the country a major oil laundering hub (CSD, 2025a).
Natural gas trade has followed a similar pattern. Gazprom remains Türkiye’s dominant supplier through long-term contracts with state-owned BOTAŞ. The proposed establishment of a Turkish gas hub, rebranding Russian gas as ‘Turkish blend’ and re-exporting it to Europe via the Gazprom-controlled TurkStream pipeline, threatens to turn Ankara into a covert extension of Gazprom’s European supply chain, particularly after Ukraine’s transit agreement expired at the start of 2025.
By laundering Russian oil and gas, Türkiye has undermined the impacts of Western sanctions. This has not only increased the Kremlin’s ability to continue its war effort in Ukraine but also decreased energy security across the EU.
Strategically located between Europe, Asia, and the Middle East, and exerting considerable economic influence across the Black Sea, the Balkans, and North Africa, Türkiye has leveraged its geographic position to become a central platform for Russian sanctions evasion. Its decision not to join the Western sanctions coalition, paired with a flexible and opaque regulatory environment in the energy and financial sectors, has enabled Ankara to act as a key facilitator in laundering Russian fossil fuels, diverting sensitive dual-use goods, and sheltering assets linked to sanctioned Russian elites.
Türkiye’s role in bypassing the Russian oil ban
Türkiye’s decision not to align with EU sanctions has rendered it a crucial partner to the Kremlin’s ongoing sanction circumvention activities. Türkiye imports more than 40 per cent of its natural gas and over 70 per cent of its coal and oil from Russia. Turkish refineries, particularly STAR and Tupras, have become central to processing Russian crude and exporting the oil products to G7 countries, generating billions in war-bound tax revenue for the Kremlin. Ports such as Ceyhan and Mersin have become key transshipment zones, where Russian-origin oil products are blended, stored, and shipped to EU Member States, undermining the effectiveness of Western sanctions. Ceyhan, in particular, has become a significant transshipment and blending hub, handling Russian petroleum products far exceeding its refining capabilities.
Between early 2023 and the end of 2024, Türkiye became the world’s largest importer of Russian oil products and the third-largest importer of Russian crude. The Turkish refineries processed an estimated EUR 7.3 billion worth of Russian crude in 2024, processing it in refined products subsequently exported to G7+ countries. Shell companies and financial intermediaries played crucial roles in this intricate system, utilising complex financial networks involving Turkish banks to hide the true origin of Russian petroleum products. Through these sophisticated financial structures, Russia has successfully maintained significant revenue streams from oil products despite international sanctions.
The new Russian gas hub
Similar to its oil strategy, Russia has actively expanded its natural gas infrastructure in Türkiye to sustain its economic influence in European markets. The Blue Stream and TurkStream pipelines deliver substantial volumes of gas directly to Türkiye and onwards to Europe. In 2024, Russia accounted for nearly 42 per cent of Türkiye’s gas imports, up from 24 per cent in 2019. Ankara and Moscow aim to establish a Turkish gas hub, preserving Gazprom’s foothold in the EU. TurkStream, now Russia’s largest gas export corridor to Europe, is central to that plan. Its possible expansion could derail EU efforts to fully phase out Russian gas by 2027.
Türkiye’s role in sustaining Russian gas exports undermines EU diversification efforts and risks distorting European gas markets. The availability of cheap, rerouted Russian gas has depressed prices and disincentivised investment in Black Sea production (e.g. offshore Romania and Türkiye) and delayed infrastructure development, such as liquefied natural gas (LNG) terminal expansions in Greece, Croatia, and Poland, risking the creation of stranded assets. TurkStream has enabled Gazprom to bypass Ukraine entirely, completing Russia’s strategic goal of removing a key leverage point for Kyiv.
The sanctions evasion bridge
Beyond energy, Türkiye has emerged as a central hub for the circumvention of Western export controls on dual-use goods – technologies and components that have both civilian and military applications. After the full-scale Russian invasion of Ukraine, exports of dual-use goods from Türkiye to Russia surged, as Western companies slashed direct shipments. Between March 2022 and February 2024, Türkiye exported $242 million worth of high-priority dual-use items to Russia, second only to Kazakhstan and significantly above pre-war volumes. Overall, between 2019 and 2024, the value of Turkish exports to Russia in manufactured goods vulnerable to sanctions nearly tripled to over €2.75 billion.
This spike in exports coincided with a dramatic increase in Türkiye’s imports of the same types of goods from the EU and the United States. For example, Türkiye’s imports of electronic integrated circuits and semiconductors, including US-origin components, jumped by more than 50 per cent in 2023 alone. These items were often re-exported to Russia under generic classifications that obscured their true end use and end user. Customs data show that the share of Türkiye’s dual-use exports to Russia rose to over 15 per cent of its total exports of electronics and 7–10 per cent of its machinery exports by 2024.
Critical items shipped to Russia through Türkiye include:
- microelectronics and semiconductors used in missile guidance systems, drones, and communications equipment;
- machine tools and precision lathes essential for weapons production;
- aerospace components and aircraft parts, many of which are restricted under US and EU sanctions.</BL>
The surge in these sensitive exports was enabled by a proliferation of Turkish intermediary companies. Over 13,000 new companies linked to Russian nationals were established in Türkiye in 2022 alone. Many of these acted as logistics providers, financial intermediaries, or simple shell entities used to obscure Russian ownership and financing structures.
Notably, US authorities have sanctioned Turkish firms such as Dexias Industrial and Azu International for supplying Russia with US-origin microchips and electronics found in Russian weapons systems deployed in Ukraine. By the end of 2024, over 200 Turkish-registered entities and 72 individuals were designated by the US for enabling the flow of sanctioned goods and technologies to Russia.
The trade was further facilitated through Türkiye’s network of free zones and ports, where enforcement of export controls is notoriously weak. Russian-affiliated shipping companies have expanded their operations in Turkish ports, taking advantage of lax customs oversight and minimal due diligence requirements. This permissive regulatory environment has turned Türkiye into a logistics and commercial hub for Kremlin-linked procurement networks.
Unless addressed decisively, this dual-use goods pipeline will undermine the entire Western sanctions architecture by enabling the Russian war economy to access critical components that would otherwise be out of reach. A tightening of Türkiye’s export control regime – aligned with EU dual-use regulations – and the establishment of a joint EU–Türkiye compliance monitoring system are urgently needed to close this major enforcement gap.
Implications for Europe’s strategic decoupling from Russia
Since the Russian invasion of Ukraine, Türkiye has emerged as one of the Kremlin’s most crucial economic partners. As Western countries have sought to isolate Russia through trade, financial, and energy sanctions, Türkiye has instead doubled down on its economic partnership with Moscow. A combination of geopolitical pragmatism and cooperation between state capture networks in both countries have transformed Türkiye into a critical gateway for Russian capital, goods, and influence, blunting the effects of sanctions and reinforcing the Kremlin’s war economy. Türkiye’s role as a strategic enabler of Russia’s sanctions evasion poses a significant challenge to the EU’s efforts to achieve energy security, uphold the integrity of its sanctions regime, and preserve geopolitical unity in the face of Russia’s war on Ukraine. By serving as a laundering hub for Russian oil and gas and facilitating the re-export of dual-use goods critical to Moscow’s military-industrial base, Türkiye has allowed the Kremlin to maintain vital revenue streams and sustain its war effort.
Recommendations
To address this growing threat, the EU must adopt a comprehensive and layered strategy that combines enforcement, diplomatic engagement, and incentives.
- The EU should move decisively to close refining and transshipment loopholes by banning imports of oil products from refineries that predominantly process Russian crude and by implementing rigorous chemical tracing protocols to verify the true origin of petroleum imports. Such measures would curtail the ability of Russian oil to reach European markets through third-party intermediaries.
- The EU should also expand secondary sanctions to target the financial and corporate networks, particularly in Türkiye, Azerbaijan, and Central Asia, that facilitate the laundering of Russian-origin energy and goods. These sanctions should apply not only to entities directly engaged in circumventing restrictions but also to the banks and logistics providers that enable them.
- In addition, the EU should propose a strategic monitoring and cooperation framework with Türkiye. This would entail linking Türkiye’s gradual alignment with EU sanctions and export controls to tangible economic benefits, such as preferential access to the Carbon Border Adjustment Mechanism (CBAM), financial support for decarbonisation and regulatory convergence, and improved access to European investment and trade mechanisms. Conditionality and transparency would be essential to this framework’s credibility.
- European countries should also accelerate investment in alternative energy routes to reduce the strategic leverage of energy transit states such as Türkiye. This includes the rapid deployment of renewables, LNG infrastructure, and regional interconnectors in trusted EU and NATO member states. Diversifying energy flows and boosting resilience in front-line countries such as Greece, Bulgaria, Romania, and Poland would help diminish the strategic relevance of Russian-linked supply chains (CSD, 2022).
- Finally, the EU should bolster civil society and transparency initiatives across Türkiye and the wider region. Supporting investigative journalism, anti-corruption watchdogs, and independent monitoring organisations will be key to exposing illicit networks, tracking sanctions circumvention schemes, and sustaining pressure for reform from within.
Effectively decoupling from Russian energy and economic influence requires more than sanctions enforcement. It demands a strategic rethinking of Europe’s external partnerships. Türkiye’s geopolitical location and NATO membership make it too important to isolate and too risky to ignore. The EU must strike a balance between deterrence and engagement, using both pressure and partnership to bring Türkiye back into alignment with the West’s security and economic order. Only then can Europe ensure that its sanctions regime is not just robust on paper but also enforceable in practice.
References
CSD (Center for the Study of Democracy). (2022). ‘The Great Energy and Climate Security Divide: Accelerated Green Transition vs. the Kremlin Playbook in Europe’. 30 September, https://csd.eu/publications/publication/the-great-energy-and-climate-security-divide/.
CSD (Center for the Study of Democracy). (2025a). ‘The Kremlin Playbook in Türkiye: Geoeconomics Unfolded’. 15 May, https://csd.eu/publications/publication/the-kremlin-playbook-in-tuerkiye/.
CSD (Center for the Study of Democracy). (2025b). ‘The Last Mile: Phasing Out Russian Oil and Gas in Central Europe’. 15 May, https://csd.eu/publications/publication/the-last-mile/.
CSD (Center for the Study of Democracy). (2025c). ‘Strategic Stalling: Czechia Delays Decoupling from Russian Energy’. 1 April, https://csd.eu/publications/publication/strategic-stalling/.