Trading Ukraine for a Lukoil deal is a profound failure

By Tom Beckwith · Reporting from Washington · October 3, 2026

By mixing Ukraine peace talks with a buyout of Lukoil assets, Washington replaces serious diplomacy with private profit for Todd Boehly and other allies.

Interests first, capabilities second, statements last

A proper diplomatic cable starts where the leverage lives. Interests dictate movement, capabilities set the limits, and statements are simply the noise made while the paperwork clears. Special envoys Steve Witkoff and Jared Kushner met Vladimir Putin at the Kremlin on September 5. According to New York Times reports cited by Yonhap, they did not discuss European borders out of charity. They came with an order book. The Kremlin wanted a buyer for the stranded international holdings of Lukoil. The Russian oil giant landed on U.S. and British sanctions lists in October 2025. Moscow can divest these assets to signal a business reset, but it fears losing its foreign cash flows. Washington has the power to grant sanctions relief, but it fears high energy prices. It sought to ease fuel markets strained by Middle East conflict, as 1News.az noted. Peace talks on Ukraine now include a deal for Lukoil's foreign assets, as detailed by The Moscow Times. Nations have interests, not friendships. The interest here is turning a geopolitical crisis into a private portfolio adjustment.

The mechanics of the loan-for-shares scheme

The Loan-for-shares scheme offers the clear historical parallel. Beginning in 1995, Boris Yeltsin's government began privatizing state-owned shares through a loans for shares scheme. The scheme helped with fundraising for Yeltsin's reelection campaign. Both eras share an identical mechanism. They transfer strategic state-linked assets to loyalists to secure political stability. Putin proposes the Lukoil sale to show that Russian and American businesses can work together. The Times of India reported this proposal. The leading bidder to acquire Lukoil's foreign assets is an investor group led by American financier Todd Boehly. Boehly contributed $1,000,000 to the pro-Trump hybrid PAC MAGA Inc. in December 2025. Alongside Boehly stand Middle Eastern investors, including the Al-Khayyat family. An Abu Dhabi fund controlled by Sheikh Tahnoon bin Zayed Al Nahyan is also involved. These partners maintain business connections to Jared Kushner and the venture World Liberty Financial. As the Abraham Accords proved, private business networks and non-traditional diplomatic channels can secure strategic agreements. Yet when those same networks profit from lifting sanctions during active war negotiations, statecraft becomes self-dealing.

The strongest opposing case fails against the ledger

The administration's defenders offer a pragmatic defense that deserves a fair hearing. The strongest opposing case holds that pragmatic diplomacy requires horse-trading. Defenders argue that transferring Lukoil's foreign assets to Western-backed buyers helps lower global energy prices. They believe this brings Moscow to the negotiating table over Ukraine. Previous bids from the trader Gunvor failed because the Treasury Department refused a license. A tentative deal with Carlyle also stalled. This left Boehly's consortium to clear the assets under rolling general licenses. This argument mistakes a commercial shakedown for grand strategy. Sanctions are not bargaining chips for personal goodwill or private capital gains. They are tools of deterrence meant to impose costs until strategic behavior changes. Deterrence dies when the reward for invading a neighbor is discounted energy infrastructure for presidential donors. The Iran Nuclear Deal showed the immense diplomatic weight required to lift sanctions for verified security gains. Nord Stream 2 showed the peril of letting private corporate interests dictate state-level diplomatic goals through energy pipelines. Trading Ukraine's future for a Boehly-led buyout of Lukoil's foreign assets does not end a war; it monetizes it.

The United States has substituted alliance management for a transactional bazaar. Our word means nothing in foreign capitals when our treaties and sanctions are for sale to the highest bidder. Five years out, this move will cost Washington its credibility, leaving its sanctions regime permanently broken.

Trading Ukraine for a Lukoil deal is a profound failure

Interests first, capabilities second, statements last

The mechanics of the loan-for-shares scheme

The strongest opposing case fails against the ledger

Sources