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Russian oil: the largest trader in the world gives up

According to Bloomberg, Vitol Group, the world's leading oil trader, will close trading in Russian crude in the second quarter and cease all trading by the end of the year. This follows the Ukrainian government's request to the world's largest energy traders to stop managing Russian energy products.

The Russian crude oil trade "will decline significantly in the second quarter as the current term contractual obligations decline," a spokesperson for Vitol said. Trade in all raw products will cease "by the end of 2022," the spokesperson added.

Vitol's announcement comes after Oleg Ustenko, economic adviser to Ukrainian President Volodymyr Zelensky, wrote a letter to the Geneva-based commodity trading company, along with others, including Trafigura, Glencore and Gunvor, at the end of March, calling for an immediate halt to trade with Russia as export proceeds help finance Moscow's war machine.

"The fact is that the traders are operating and helping Russia to receive this blood money," Ustenko recently told FT . "This round of resources finances war crimes and genocide against Ukrainian citizens".

Data from the Bruegel group of experts and the International Institute of Finance estimates that Russian exports of crude oil and natural gas to Europe provide Moscow with $ 850 million a day.

Russian oil and gas are not directly affected by the EU sanctions against Russia for its invasion of Ukraine, but there are growing difficulties in purchasing them for. In the United States, the Biden administration has banned the purchase of Russian energy products and is putting strong pressure on Europe to align with it. However, refineries in India and China continue to buy Russian petroleum products, and at hefty discounts.

Price of Ural Oil

Trading companies usually have long-term or prepaid contracts with producers, such as Russia's Rosneft PJSC, to purchase a certain amount of oil each month. Glencore and Trafigura said last week that they would honor their long-term deals. Glencore said it was not expanding trade operations with Russia, while Trafigura said it had reduced volumes of Russian crude.

From the start of the war until the end of March (just over a month), Vitol, Glencore, Trafigura and Gunvor unloaded 33 Russian crude oil tankers, according to Global Witness' Refinitiv data.

Meanwhile, BP Plc, Shell Plc and Exxon Mobil Corp have divested their shares of energy assets in Russia.

Only the Western world has distanced itself from Russian crude as China begins to trade yuan for Russian coal and oil. Moscow is also considering a rupee payment system for Indian oil traders. It could be the birth of a new economic order


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The article Russian oil: the largest trader in the world gives up comes from ScenariEconomici.it .


This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/petrolio-russo-il-maggiore-commerciante-al-mondo-vi-rinuncia/ on Wed, 13 Apr 2022 19:38:26 +0000.