Russia's second-largest oil producer, Lukoil, has agreed to sell the bulk of its international assets - initially valued at $22 billion by analysts - to private equity heavyweight Carlyle, as Western sanctions continue to force a fire sale of Russian energy holdings abroad.

This sanctions-induced fire sale was expected, as the company had first unveiled in late October: "Lukoil informs that owing to introduction of restrictive measures against the Company and its subsidiaries by some states the Company announces its intention to sell its international assets." 

The US sanctions on Lukoil and Rosneft represented the first major round of economic penalties imposed on Moscow following Trump's return to his second term in the White House.

"I just felt it was time," Trump had told reporters on Oct. 22 while hosting NATO Secretary-General Mark Rutte in the Oval Office. "These are tremendous sanctions. We hope they won’t be on for long. We hope that the war will be settled."

It was seen as a way to pressure the Kremlin to the negotiating table - something with 'teeth' - but the reality has remained that the Zelensky government and its Western backers are unwilling to give up territory, which is a Moscow main sticking point.

The oil sanctions were imposed "as a result of Russia's lack of serious commitment to a peace process to end the war in Ukraine" - and that forced Lukoil into a formal bidding process.

The Carlyle deal notably excludes Lukoil's assets in Kazakhstan, which will remain under Lukoil Group ownership and continue operating under existing licenses.

The agreement is non-exclusive and remains contingent on multiple conditions, including regulatory approvals and explicit authorization from the US Treasury’s Office of Foreign Assets Control (OFAC) for the transaction with Carlyle, according to various industry reports.

Discussions and negotiations with other potential buyers are still ongoing, Lukoil has said in the meantime. 

Previously Chevron and ExxonMobil, as well as Abu Dhabi's International Holding Company (IHC), had expressed official interest to the U.S. Treasury in acquiring Lukoil's international portfolio.