US: Treasury officials allegedly urge largest commodity traders to shed concerns over shipping price-capped Russian oil to keep supplies stable
US taps big trading houses to help move price-capped Russian oil, 9 March
The US has privately urged some of the world’s largest commodity traders to shed concerns over shipping price-capped Russian oil, in a bid to keep supplies stable and regain some oversight of Moscow’s exports.
US Department of Treasury officials met executives and traders at Trafigura and Gunvor among others, according to five people familiar with the talks, and offered reassurances over expanding their role in Russian crude and fuels trade without breaching western restrictions.
While Washington has never opposed trading of Russian oil within G7-agreed price curbs, the largest independent oil traders had been wary of the market. “We’ve been actively encouraged by the Americans . . . to re-engage on moving the oil,” said one trader who spoke with the Treasury.
The US reassurances, delivered in meetings with leading independent oil traders in recent weeks, come as Russia has threatened to cut oil supplies this month after western powers ratcheted up support for Ukraine...
“It’s up to individual companies to make their own decisions. Our goal is to communicate what is allowed under the price cap architecture,” said one Biden administration official, adding that the discussions focused on the structure of the market.
Global traders including Trafigura, Vitol and Gunvor have all wound down most or all of their Russian business since the full-scale invasion of Ukraine. The groups feared a public backlash or loss of support from banks they rely on to finance the millions of barrels they ship globally each day.
But that has left Russia increasingly reliant on smaller trading houses to move its oil to new markets in Asia. There are mounting concerns about the safety of older tankers being used, without western insurance or shipping services, in an increasingly opaque trade.
The Biden administration’s talks with western traders about shipping more Russian oil illustrates the delicate tightrope for the White House and G7 as they attempt to slash the Kremlin’s oil revenue without disrupting the market...