Energy Export Ban Hits China, Russia, and Iran: New Bill Imposes $250M Fines and 20-Year Prison Terms

The aptly titled Protecting American Households From Rising Energy Costs Act of 2025 is a major move that uses national security restrictions to try and bring down domestic energy prices. Essentially, this bill slaps a hard stop on the export and resale of U.S. Liquefied Natural Gas (LNG) and petroleum products to any company operating in or controlled by the governments of China, Russia, North Korea, or Iran (SEC. 3).

The goal, according to the title, is to increase the domestic supply of these fuels, theoretically pushing prices down for consumers who are currently getting squeezed by rising costs. The bill puts the Secretary of Energy in charge of enforcing this ban and determining exactly who counts as being “owned or controlled” by these foreign governments, which is a big piece of bureaucratic power that will directly affect global energy markets and U.S. exporters.

The Geopolitical Supply Chain Lockup

This isn't just about trade; it’s about using U.S. energy as a geopolitical tool. If you’re an American energy exporter, you now have a huge compliance headache and a massive new risk profile. You are responsible for ensuring that your LNG or petroleum product doesn't end up in the hands of the prohibited nations, even if it gets resold multiple times (SEC. 3).

What if a U.S. exporter has a contract with an ally, say, in Europe, but that European company has a subsidiary that does business in China? The Secretary of Energy, working with the Treasury and Commerce Departments, gets to make the final call on whether that connection violates the "owned or controlled" clause. This ambiguity creates a massive liability for any company involved in the logistics of moving these fuels.

The Exception Rule: National Security Only

Exporters looking for a way out of this ban won't find much relief. The Secretary of Energy can only grant a waiver if there is an "immediate and severe national security emergency" facing the U.S., and there are no other ways to handle that emergency (SEC. 3). That is an extremely high bar. It means that market stability, economic hardship, or even allied diplomatic needs won't be enough to lift the ban—it has to be a crisis that threatens the country itself. For energy companies trying to plan multi-billion dollar contracts years in advance, relying on a waiver that requires a national security emergency is essentially a non-starter.

The Punishment Is Severe

Here is where the bill gets truly alarming for anyone in the energy sector. The enforcement provisions are designed to be punitive. If the Secretary finds that a violation has occurred, the civil penalty is the larger of two amounts: a flat $250,000,000 or twice the total dollar amount of the illegal transaction (SEC. 4). For a mid-sized energy company, a single accidental violation of a complex resale rule could mean immediate bankruptcy.

And it gets worse. If someone knowingly breaks the rules, they face criminal charges, including a fine of up to $100,000,000, up to 20 years in prison, or both (SEC. 4). This isn’t a slap on the wrist; this is leveraging federal criminal law to enforce trade policy, putting immense pressure on corporate compliance officers and executives. The bill is essentially telling U.S. energy exporters: you must be perfect, or we will ruin you.