How Russia 'uses shadowy network of front energy firms to dodge sanctions and sell oil to the west to continue funding war in Ukraine'

Russia is still funding its war against Ukraine through sales of oil and gas, despite western sanctions, by using networks of shadowy companies, the National Crime Agency (NCA) has warned.

Last year (2024) 30 percent of Russia’s federal budget came from oil and gas sales, according to an NCA alert published this month.

The NCA report said: "Russian oil trading companies are utilising a complex network of companies to evade sanctions whilst accessing Western finance and professional services in order to continue to fund the Russian state.

Shadowy front companies, ship-to-ship transfers and aging tankers are used to try to hide the origin of the oil being sold.

In 2024, a network of companies run by UK-sanctioned Azeris Etibar Eyyub and Tahir Garayev traded more Russian oil than any other entity, it said.

The majority of Russia's man energy company ROSNEFT was traded by the pair's network.

They have personal relationships with the UK-sanctioned ROSNEFT CEO Igor SECHIN, (below) a powerful ally of Russian President Vladimir Putin, which enables this privileged access to Russia’s largest state-owned oil company.

The report added: "The sanctions evasion and avoidance network is resilient and consciously split between two sides, and known to its affiliated traders/brokers as 'blue' and 'red'.

"The 'blue' side works with entities in the Global West, including banks, insurers and trading platforms. The leading companies of this side of the network were 2RIVERS DMCC and 2RIVERS PTE, both sanctioned by the UK in December 2024.

"The 'red' side of the network, with deliberately obscure ownership structures and many front companies designed to be replaced with ease if they are subject to Western sanctions, trades Russian oil directly.

"The leading company on this side of the network was NORD AXIS, sanctioned by the UK in May 2025.

"Finance and oil move between the different sides of the network. Access to Western rates of trade finance, trusted insurers and key commodity exchanges utilised by ‘blue’ companies are combined with the special relationship with ROSNEFT’s CEO and privileged access to Russian oil of the ‘red’ companies, to create a global trading network generating billions of USD.

"Money and oil move between the companies through transhipments of oil and mixing operations to hide the Russian origin.

"The 2RIVERS network utilises over 100 Shadow Fleet oil tankers, vessels which are usually over 15 years old and use deceptive shipping practices to carry Russian oil.

"Deceptive practices include switching off the ship's automatic identification system (AIS) to avoid the ship's movements being tracked, engaging in ship-to-ship transfers to obscure the origin of the oil before it reaches its destination, and regularly changing flags. Over 400 Shadow Fleet vessels have now been sanctioned by the UK, EU, US and Canada."

The sanctions on 2RIVERS DMCC and 2RIVERS PTE will have severely limited the network’s ability to access Western services and trade Russian oil profitably, said the NCA.

However, there are many more companies within this network, and the people behind it will likely continue to attempt to manipulate the system to benefit their trade by replacing sanctioned entities with freshly incorporated companies clean of sanctions but fulfilling the same role, it warned.

The report added: "We are raising awareness of these malicious practices in order for Western banking, insurance and the professional service industry to be alert to the persistent attempts employed by the people and companies associated with Eyyub and Garayev and to help keep up the pressure on this network.

"Sanctions imposed on Russia as a result of its invasion of Ukraine have had a significant impact on its ability to sell oil and gas it produces. However, in an effort to circumvent these controls, Russian oil trading companies are utilising a complex network of companies with deliberately obscure ownership structures to evade sanctions whilst accessing Western finance and professional services in order to continue to fund the Russian state.

"This Alert provides potential indicators of Shadow Fleet activity to help financial institutions detect and report it. The alert has been issued to the regulated sector, but will also be relevant to business sectors outside the regulated sector for anti-money laundering."