Shell bought Russian oil very cheaply: ‘We want to stop with it in the long run’

Oil and gas group Shell bought 725,000 barrels of Russian oil at a relatively high price. The company paid 26 euros below the barrel price of Brent oil, an important type of oil on the world market. According to international media, including the Financial Times, Shell could make more than 18 million euros in profit with the shipment.

There is no international ban on oil and gas from Russia, but traders stopped buying Russian commodities last week. The price of the cargo that Shell is currently buying from trading company Trafigura has fallen in recent days.

Shell announced on Monday that it would withdraw from Russia because of the Russian invasion of Ukraine. The cooperation with the Russian company Gazprom broke down.

essential oil

“We have also shut down most of the Russian oil activities,” the company said in a statement. “But we continue to source for some of our refineries and chemical plants to ensure we can produce the fuels and products that consumers and businesses use every day.”

The company wants to buy less oil from Russia in the long term if there are alternatives on the market. “But it’s complicated because Russian oil plays an important role in global supply and there are relatively few alternatives in the current tight market.”

moral consciousness

According to energy expert Lucia van Geuns of the Center for Strategic Studies in The Hague, Russian oil is still needed for diesel production, for example. “We cannot live without it at the moment and there is no blanket boycott of Russian oil. What you see now is that trade is putting restrictions on Russian oil. It’s not just because of a moral compass, but they are more risky than oil. Shell traders thought they could take the risk at that price.”

The price of crude oil has soared since the war in Ukraine. The barrel price of crude oil rose from $90 a month ago to $118 today. Van Geuns: “The world oil price would have been much higher if Russian oil had not been bought.”

The increase in the oil price can be seen at the gas pump, where a few cents are added to the liter price almost daily. At the most expensive gas stations on the highway, a liter of petrol now costs 2.45 euros.

Source: NOS