Private equity firms vying for Russian oil and gas assets

Major U.S. private equity firms are jockeying to pick up 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 multiple countries from Mexico to Iraq, refineries in Romania and Bulgaria, and thousands of gas stations in 20 countries. While no deal amount was disclosed, Lukoil’s international fossil fuel business is valued at around $22 billion. The deal is non-exclusive and will need to seek regulatory approval, including from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). Quantum Capital, a private equity firm that specializes in energy, has partnered with Chevron in a rival bid for the Lukoil assets, Reuters reported.  

Lukoil, Russia’s second-largest oil producer, is facing pressure from U.S. and EU sanctions to offload overseas assets. Lukoil has until February 28 to sell the assets, the latest deadline set by the U.S. Treasury, which imposed sanctions on Lukoil and Rosneft last year to push Moscow to agree on a peace deal with Ukraine. The sale of Lukoil’s international energy assets to a U.S. private equity firm would make one of the most significant private equity transactions linked to Russian oil and gas assets since the sanctions were introduced in 2022. Carlyle and Quantum have been active with fossil fuel acquisitions, and this latest deal shows the firms are ready to put institutional investors’ money on the line to bail out Russia’s oil industry

Carlyle Not Slowing Down Despite Recent Failures

Carlyle has long stood out among large diversified private equity firms for its large energy portfolio, most of which consists of fossil fuel companies. A 2022 Private Equity Climate Risks report found Carlyle’s fossil fuel portfolio was estimated to be valued at $22.4 billion, and its energy assets produced a “carbon bomb” of emissions, an estimated 277 million metric tons of CO2 emissions, over ten years. 

Carlyle’s energy portfolio includes fossil fuel assets in several European countries, the U.S., and South America, but the firm has faced challenges in its attempts to further expand its global fossil fuel portfolio. It appears Carlyle remains steadfast in its commitment to continue its overseas fossil fuel expansion. In 2025, two of Carlyle’s major overseas energy acquisitions failed: its $945 million venture to acquire Energean assets and build an overseas upstream oil & gas platform collapsed, and its $23.7 billion bid alongside the Abu Dhabi National Oil Company (ADNOC) for Australian LNG producer Santos also fell through after months of negotiations. 

As of January 2026, 71% of Carlyle’s energy portfolio consisted of fossil fuel companies, despite its 2022 commitment to a net zero portfolio by 2050. 

Explore Carlyle’s fossil fuel portfolio as of January 2026 here. 

Should Carlyle finalize the acquisition of Lukoil’s international assets, the firm would significantly expand its oil and gas portfolio globally and would cement its position in Romania, expanding its footprint there significantly. Carlyle already owns Black Sea Oil and Gas (BSOG), the third-largest gas producer in Romania, and with the acquisition of Lukoil’s 87% ownership of the Trident block in the Black Sea, the firm would control a large share of oil and gas production in the country. 

Quantum Capital Aiming for A Top Spot in the Global Fossil Fuel Market

Quantum has spent at least $18.7 billion over the past decade acquiring fossil fuel assets in the U.S. and abroad. Quantum has a large portfolio of energy assets in the U.S., with over 11 thousand oil and gas wells across the country. The 2024 Private Equity Climate Risks Scorecard found that Quantum’s upstream operations fuel climate chaos as they were responsible for over 152 million metric tons of CO2e, and were responsible for an estimated $2.4 billion in public health costs annually, due to toxic air pollutants emitted from the operation of the assets. The firm’s investments have direct impacts on the environment and human health, driving climate catastrophe and causing asthma, hay fever, and even premature deaths. 

Explore Quantum’s Fossil Fuel Asset Map as of September 2025 here. 

Quantum is also active in the midstream and downstream sectors in the energy market. The firm has a history of driving a problematic midstream project that faced community pushback against a proposed natural liquified gas (LNG) project, Saguaro LNG, in a designated UNESCO World Heritage Site in the Gulf of California. Quantum also purchased alarge portfolio of downstream gas power plants from Carlyle back in 2024, only to turn around and sell them just two years later, which would earn the firm around $1 billion of profit on the sale. This could be part of a larger trend of private equity firms flipping gas plants to energy producers to feed swelling data center and AI demand. 

Private Equity Bails Out Russian Big Oil, Investors Shoulder the Risk

Private equity firms often act as the investor of last resort, making them a prime target for energy companies trying to offload unwanted oil and gas assets quickly. The capital Carlyle and Quantum would use to bail out the Russian oil major, and its executives, would likely come from institutional investors in the firms’ energy and infrastructure funds. These institutional investors, or limited partners, include public pension funds, university endowments, insurance companies, and foundations. 

For example, some of Carlyle’s limited partners with investments in its energy and infrastructure funds are California Public Employees’ Retirement System (CalPERS), CPP Investments, Washington State Investment Board (WSIB), and the State of Michigan Retirement Systems. 

Quantum Capital has several U.S. pension funds as limited partners for its Quantum Energy Partners Funds VII and VIII. 

Explore a chart of investor commitments to Quantum energy funds here. 

Despite some progress being made by some institutional investors to steer portfolios away from fossil fuels and toward a clean energy future, many remain committed to private equity firms with large and expanding fossil fuel portfolios. Now Carlyle and Quantum are vying for Lukoil’s international assets that could put retirees’ pensions on the line to bail out a Russian oil company.