Carlyle and Quantum Capital Vie for Lukoil’s Overseas Assets Amid Sanctions

Major U.S. Private equity firms are competing to acquire Russian oil major Lukoil’s overseas fossil fuel assets. Under pressure to sell due to Western sanctions, The Carlyle Group has reached a tentative deal to purchase most of Lukoil’s international oil and gas assets, which include oil fields in countries like Mexico and Iraq, refineries in Romania and Bulgaria, and thousands of petrol stations across 20 countries.

Deal Details and Valuation

While the exact deal amount remains undisclosed, Lukoil’s international fossil fuel business is valued at approximately $22 billion, according to the company’s previous statements . The agreement is non-exclusive, meaning Lukoil can continue negotiations with other potential buyers, and is contingent upon regulatory approvals, including from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC).

Competing Bids

A rival bid has emerged from Quantum Capital Group, which has partnered with Chevron Corporation . This competition underscores the strategic importance of these assets and the ongoing interest from major players in the energy sector.

Sanctions and Asset Sales

Lukoil, Russia’s second-largest oil producer, is facing increasing pressure from U.S. And EU sanctions to divest its overseas holdings. Sanctions were imposed on Lukoil and Rosneft in October 2025 in response to the conflict in Ukraine . Lukoil has a deadline of February 28, 2026, set by the U.S. Treasury, to complete the sale.

Carlyle’s Expanding Energy Portfolio

The potential acquisition would significantly expand Carlyle’s oil and gas portfolio globally, particularly in Romania. Carlyle already owns Black Sea Oil and Gas (BSOG), the third-largest gas producer in Romania, and acquiring Lukoil’s 87% ownership of the Trident block in the Black Sea would solidify its position in the country’s energy market.

Despite a commitment to a net-zero portfolio by 2050, Carlyle’s energy portfolio remains heavily weighted towards fossil fuels. As of January 2026, 71% of its energy portfolio consisted of fossil fuel companies . Carlyle experienced setbacks in 2025 with the collapse of a $945 million venture to acquire Energean assets and the failure of a $23.7 billion bid for Australian LNG producer Santos.

Quantum Capital’s Growth and Impact

Quantum Capital has invested at least $18.7 billion in acquiring fossil fuel assets in the U.S. And internationally over the past decade. The firm’s operations have been linked to significant carbon emissions, estimated at over 152 million metric tons of CO2e annually, and associated public health costs of $2.4 billion per year . Quantum too previously sold gas power plants to Carlyle in 2024, realizing a $1 billion profit.

Private Equity and Russian Assets

Private equity firms are often the investors of last resort for energy companies seeking to quickly offload assets. The capital for these acquisitions typically comes from institutional investors, including public pension funds, university endowments, and insurance companies. Carlyle’s limited partners include California Public Employees’ Retirement System (CalPERS), CPP Investments, Washington State Investment Board (WSIB), and the State of Michigan Retirement Systems. Quantum Capital’s funds also have commitments from several U.S. Pension funds.

The acquisition of Lukoil’s assets represents one of the most significant private equity transactions involving Russian oil and gas assets since the introduction of sanctions in 2022.