Following Russia’s invasion of Ukraine, the international community (U.S., EU, G7) imposed extensive sanctions to restrict Moscow’s access to technology, capital, and energy. However, Turkey, elected not to align with the sanctions adopted by the UN. This decision has positioned Ankara as the only NATO member serving as a strategic loophole, effectively rendering sanctions unenforceable, as they can be circumvented via Turkey in trade, energy, and financial transactions.
Trade and dual-use exports to Russia
Investigations revealed that Russian firms continued to procure critical goods through intermediaries, with Turkey playing a central role. The U.S. has sanctioned Turkish entities for supplying microchips and electronics to Russia. Turkey has become a sanctions hub of circumvention exposure for its own firms. Concurrently, Ankara increased overall trade with Russia from $33 billion in 2021 to over $57 billion in 2022.
Energy flows and diversions
Energy represents one of the most significant channels through which sanctions have been circumvented. By 2023, Turkish imports of Russian crude oil reached record highs (400,000 barrels per day), while imports of Russian diesel and jet fuel surged by 200%. Turkey emerged as the world’s largest buyer of Russian oil products and a conduit for €3 billion worth of imports into the EU through ports such as Ceyhan and Mersin, rendering sanctions effectively unenforceable.
Furthermore, Turkey became the third-largest global importer of Russian crude oil. Despite international pressure, Turkey continued purchasing Russian crude until 2025, with Tüpraş curtailing only after new U.S. sanctions.
Turkish shipping entities are also involved with Russian oil transportation above the $60/barrel price cap, prompting sanctions from the U.S. Department of the Treasury.
Role in energy via pipelines
The TurkStream Gas Pipeline continues delivering Russian gas to Turkey and onward to Europe, reinforcing Turkey’s role as a key energy hub. Revenues from preferential pricing and transit fees are estimated at $3 billion in 2021, rising above $5 billion in 2022, and remaining high at $4–4.5 billion in 2023.
Halkbank case and gold trade – Iran and Venezuela
Turkey has also faced significant allegations concerning violations of U.S. sanctions against Iran. In 2019, state-owned Halkbank was charged by U.S. prosecutors with fraud, money laundering and conspiracy offenses, for facilitating Iran to bypass sanctions through an “oil-for-gold” scheme, channeling $20 billion via fraudulent food and medicine transactions. Both the Supreme Court of the United States and U.S. Court of Appeals for the Second Circuit rejected the bank’s claims of sovereign immunity in 2022 and 2024 respectively. The case remains ongoing, with further appeals filed in 2025 where the U.S. Court of Appeals reiterated its earlier decision, reaffirming the bank’s exposure to prosecution over Iran sanctions scheme. Despite the recent deferred prosecution agreement between the U.S. Department of Justice and Halkbank, Turkey was proven to have participated in a massive, multi-year scheme to circumvent U.S. sanctions against Iran.
In 2024, the U.S. sanctioned 280 companies, including several Turkish firms. In 2025, the U.S. Department of the Treasury announced sanctions on 22 entities in Turkey, the UAE and Hong Kong for Iranian oil trade. In 2025, another Turkish company was sanctioned for Iran trade, acting as a stern warning to Turkey.
Turkey also remains one of the largest buyers of sanctioned gold. It has been found that both Iran and Venezuela used Turkey to funnel sanctioned gold into global markets. The Halkbank case sets a precedent for prosecuting state-owned enterprises that violate sanctions.
Financial sector and banking channels
Several Turkish banks, including Ziraat Bank, VakıfBank, and İşbank, have been accused of facilitating transactions with Russian and Iranian entities, bypassing SWIFT through alternative channels. In 2022, Russia’s Sberbank expanded its Turkish operations despite EU and U.S. sanctions. In 2023, the U.S. formally warned Turkey regarding heightened risks within its banking sector.
Defense industry and exports
Turkey has drawn criticism for exporting Bayraktar TB2 drones to conflict zones and countries with adversarial positions toward the West, such as Libya, Ethiopia, and Venezuela. Moreover, Turkish-made components have been identified in Russian drones deployed in Ukraine, raising serious concerns regarding the enforcement of export controls.
Civil aviation and embargo evasion
Turkish Airlines remains the only major NATO carrier maintaining regular flight operations to and from Russia. This positions the airline as one of the very few carriers still connecting Russia to international markets, undermining the spirit of the embargo.
Conclusion
Collectively, these practices position Turkey as a Trojan Horse within NATO, standing out as the only country that systematically refuses to implement UN sanctions. This loophole renders allied sanctions largely ineffective, as they can always be circumvented through Turkey. Consequently, strategic adversaries of the West and Israel, such as Russia and Iran, gain access to technology, financing, and energy channels, undermining the overall effectiveness of the international sanctions regime.