Sanctions Watch | Weekly Vol. 85

Sanctions Watch Vol 85

In the latest edition of our Sanctions Watch weekly digest, we present significant updates on sanction watchlists and regulatory developments.

1. EU Renews Sectoral Sanctions Against Russia as Hungary backs down from veto threat

The European Union has successfully extended its sectoral sanctions against Russia for six months after Hungary withdrew its veto threat, which it had linked to energy concerns. The decision was finalized during a meeting of foreign affairs ministers after assurances were provided regarding “the integrity of the energy infrastructure.” The sanctions, which include restrictions on oil, coal, technology, finance, luxury goods, and transport, along with the freezing of €210 billion in Russian Central Bank assets, were set to expire on January 31. Hungary had initially resisted, linking the issue to the termination of Russian gas transit via Ukraine.

However, Ukraine signaled flexibility by considering Azeri gas transit. The European Commission emphasized that the EU remains prepared to transition away from Russian energy. In response, Hungary welcomed further negotiations on energy security. Despite this resolution, tensions may persist as the EU prepares a 16th sanctions package, requiring unanimous approval before the third anniversary of Russia’s full-scale invasion.

2. Trump Administration Lifts Sanctions on Israeli Settlers Involved in Attacks on Palestinians

The U.S. Treasury Department announced the removal of all sanctions imposed on Israeli settlers accused of violent attacks against Palestinians in the occupied West Bank, along with the unfreezing of related assets. This decision follows President Trump’s revocation of an executive order issued by former President Biden, which had enabled these sanctions. During Biden’s tenure, the State and Treasury Departments sanctioned multiple settlers and organizations supporting illegal West Bank outposts. The move marks a win for the pro-settlement lobby in Israel and the U.S., which had actively pushed for the reversal.

However, similar sanctions imposed by the EU, Canada, the U.K., and Australia remain in place. Israeli officials reportedly lobbied Trump’s team during the transition to lift the measures, with U.S. lawmakers, including Sen. Ted Cruz, backing the effort. The policy shift comes amid a renewed surge in settler attacks on Palestinians. Last week, Israeli Defense Minister Israel Katz ordered the release of all settlers held in administrative detention for suspected attacks, a move criticized by Israeli security officials. Days later, dozens of settlers launched an attack on the Palestinian village of Funduk, underscoring concerns over escalating violence in the region.

3. President Issues Executive Order 14148, Overturning Key DEI, Climate, and Immigration Reforms

Executive Order 14148, issued on January 20, 2025, rescinds numerous executive actions from the previous administration, aiming to reverse policies perceived as inflationary, legally questionable, or ideologically driven. The order asserts that diversity, equity, and inclusion (DEI) initiatives have compromised government institutions by prioritizing preferential treatment over merit-based systems. Consequently, orders promoting racial and gender equity in federal agencies, such as Executive Orders 13985, 14031, 14035, 14075, 14091, and 14124, have been repealed.

The order also dismantles climate and environmental policies that imposed regulatory burdens on businesses. This includes the revocation of Executive Orders 13990, 14008, 14030, and 14057, which previously established climate change mitigation efforts, environmental protections, and financial risk assessments related to climate policy. The administration justifies these reversals by claiming that such policies have exacerbated inflation and hindered economic growth.

Regarding immigration and border security, the order nullifies measures such as Executive Orders 13993, 14010, and 14012, which were designed to reform asylum processing, legal immigration pathways, and family reunification efforts. The administration contends that these policies weakened national security and strained public resources.

Additionally, the order terminates federal COVID-19 mitigation measures by rescinding Executive Orders 13987, 13996, and 14099, which had established pandemic response frameworks. It also eliminates certain voting rights protections (Executive Order 14019) and police reform policies (Executive Order 14074), asserting a need for deregulation and a shift toward economic and national security priorities.

The order mandates that federal agencies review all policies implemented under the rescinded executive orders and submit recommendations within 45 days for further action. The directive reflects the administration’s commitment to overhauling regulatory frameworks, prioritizing economic recovery, and reasserting traditional governance principles.

4. OFAC removes West Bank sanctions program

The US Treasury’s Office of Foreign Assets Control (‘OFAC’) has removed all West Bank-related sanctions designations following President Trump’s revocation of the underlying executive order, according to a 24 January notice.

OFAC ‘removed the West Bank-Related Sanctions program from its website and removed all persons designated under E.O. 14115 from the Specially Designated Nationals and Blocked Persons List,’ the notice said.

The action implements Trump’s 20 January executive order that revoked President Biden’s Executive Order 14115 of February 2024, which had authorized sanctions on persons undermining stability in the West Bank.

All property and interests in property blocked under E.O. 14115 are unblocked, according to Treasury.

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Sanctions Watch is a weekly recap of events and news related to sanctions around the world.