2025 SANCTIONS TRENDS AND WHAT’S ON THE HORIZON IN 2026

A smart forecaster in late 2024 might have guessed that in 2025, the incoming Trump Administration would slow the pace of Russia sanctions, aggressively use counterterrorism authorities against drug cartels, and ramp up pressure on Iran. But few would have anticipated that the United States would sanction the head of state of a longtime ally, remove sanctions on the head of state of a former adversary, and forcibly remove the head of state of another. Or that the Administration would use the International Emergency Economic Powers Act (IEEPA) to impose tariffs, prompting a challenge now under review by the Supreme Court.

For boards, investors, senior executives, and compliance professionals, trying to predict what will happen with U.S. sanctions in 2026 is a fool’s errand, to say nothing of UK and EU economic measures. Below, Clarity recaps the key sanctions developments of 2025 and lays out what companies need to know (and do) right now to best prepare for 2026, no matter how U.S. sanctions policy may shift.

And as a bonus: read to the end to find out what Clarity’s co-founders are reading (or re-reading) and listening to in 2026.

Key Developments in 2025

Expansion of counterterrorism sanctions: U.S. classifies Mexican drug cartels as Foreign Terrorism Organizations

What this means: The new counterterrorism sanctions on drug cartels create greater regulatory risks for companies with operations or counterparties in Mexico, Colombia, and elsewhere in Latin America. In addition to enhanced sanctions enforcement risks, companies can now face criminal prosecution for providing material support or resources to these groups and could be subject to litigation under the Terrorism Risk Insurance Act (TRIA). Foreign financial institutions can also be subject to sanctions for knowingly processing “significant” transactions for these groups.

Pressure on shipping and energy: Nearly 500 tankers and dozens of oil traders added to the SDN list

What this means: The expansion of not just U.S., but also UK and EU sanctions against vessels, operators, and traders has led to more complex sanctions evasion at sea, creating compliance challenges for maritime stakeholders. While regulators continue to provide red flags and guidance to assist the shipping industry, the lack of a “smoking gun” in many potential evasion cases often leaves companies caught between trying to stay compliant and avoiding costly contractual disputes. This is made even more complicated when divergent sanctions regimes create conflict-of-law issues.

Policy changes in Syria: Major sanctions shift but doing business remains difficult

What this means: The removal of most U.S. trade restrictions on Syria after President Bashar Al-Assad’s downfall shows how quickly sanctions can shift in response to geopolitical events. But even with the removal of the Syria sanctions regulations and the repeal of the Caesar Act, Syria’s continuing designation as a State Sponsor of Terrorism and remaining export control restrictions create uncertainty for companies considering re-entering Syria, particularly for the kinds of long-term infrastructure investment that Syria needs. In a time when sanctions policy can change drastically overnight, Syria illustrates the complications of doing business in high-risk areas even after sanctions are removed.

Policy whiplash: Quick reversal or suspension of designations and regulations

What this means: The listing and subsequent delisting of Brazilian judge Alexandre de Moraes and the one year suspension of the Bureau of Industry and Security Affiliates Rule underscore how difficult and expensive quick policy reversals can be for companies. The former example shows that even companies in jurisdictions that have traditionally not faced U.S. sanctions pressure should be prepared for a rapid escalation in U.S. sanctions targeting and enforcement. The latter highlights the challenges of preparing (and budgeting) for regulatory compliance in an era in which trade restrictions are often closely tied to negotiations with foreign countries.

Investors beware: OFAC enforcement actions against private equity

What this means: In 2025, OFAC issued fines against a venture capital firm and a private equity fund, signaling its continued focus on “gatekeepers” and a special interest in investment structures with opaque ownership. Alternative investment managers should be prepared for enhanced scrutiny from OFAC and the risks that arise from providing indirect benefits to sanctioned persons.

On the Horizon for 2026

For senior leaders and boards: Never forget that OFAC now has a 10-year statute of limitations for civil enforcement of sanctions. Enforcement priorities may shift for the U.S. government in 2026, but anyone tasked with ensuring the long-term survival and profitability of a company should bear in mind that compromising on sanctions compliance in 2026 can lead to catastrophe down the road.

For businesses hiring key compliance personnel: The size and structure of a company’s compliance staff will depend on the company’s unique risk profile, but no matter what, companies must have confidence in whoever implements their compliance program and escalates sanctions issues to senior management. Investing in the right compliance talent is worth more than just a salary and benefits, and a mis-hire can be incredibly costly.

For shipowners, maritime investors, and managers: The maritime and energy industries should anticipate continued interest from U.S. and foreign regulators, especially when it comes to ship financing and energy-related transactions. Sanctions issues can quickly create legal risks, damage to vessel values, costly conflict of law disputes, and even long-lasting reputational damage. Shipowners, brokers, and maritime investors should be prepared to demonstrate due diligence done on lessors, buyers or sellers, and charterers.

For private equity firms: Successful investing in 2026 is dependent on understanding the sanctions risks associated with target companies, industries, and jurisdictions. As the U.S. government continues to use and enforce sanctions in new jurisdictions and industries, investors should regularly assess sanctions risks across their portfolios. U.S. private equity firms should perform sufficient due diligence when acquiring stakes in foreign companies to ensure their target companies have not or are not engaging in activities that would be considered violations of U.S. sanctions if undertaken by foreign subsidiaries of U.S. companies.

For companies that operate in countries where sanctioned cartels operate:  Sanctioned cartels are diversifying into new industries, further amplifying the risks from the Trump Administration’s crackdown on drug trafficking organizations. Managing these risks will require understanding exposure to counterparties, supply chains, regions, ports, and service providers in areas where cartels operate or control territory.

Clarity Reading and Listening List – January 2026

Reading

• Carbon Democracy by Timothy Mitchell

• Lloyd’s List 2026 Outlook 

Re-Reading

• World for Sale by Javier Blas and Jack Farchy

• Good Intentions Corrupted: The Oil for Food Scandal And the Threat to the U.N. by Paul Volcker, Jeffrey Meyer, and Mark Califano

• The Royal United Services Institute’s Maritime Sanctions Task Force Reports

Listening To

• Search Engine by PJ Vogt and Sruthi Pinnamaneni

• The Rest is History by Goalhanger

• Good Bad Billionaire by the BBC

• Embargoed! by Miller and Chevalier