Russian crude oil and other products will no longer be traded by Vitol Group by the end of the year, a source with knowledge of the situation tells CNN.
Sources say the Dutch energy and commodities trading firm will also not engage in any new transactions involving Russian crude and products.
Beyond confirming the accuracy of a Bloomberg article that reported the news earlier, Vitol declined to comment..
United States, UK, Canada, and Australia have all announced bans on Russian oil since Russia's invasion of Ukraine last February.Shell, TotalEnergies, and Neste have all said they will stop buying Russian crude by the end of 2022, and there has been a de facto embargo as banks, traders, shippers, and insurance companies try to avoid violating Western financial sanctions.
Due to Russian oil's reputation as a risky investment for many investors, the world's benchmark Urals crude has fallen further in price. In comparison to Brent crude, it is now worth $34 less a barrel.Russia's oil supply is expected to fall by 1.5 million barrels a day in April, and could fall by as much as 3 million barrels a day from May, according to the International Energy Agency's latest forecast on Wednesday.
Traditional customers are cutting back on purchases of sharply discounted Russian barrels while Asian buyers are increasing their purchases," the agency said. China has not seen an increase in exports at this time. "
The revenues of Vitol nearly doubled to $279 billion last year as global demand for oil rebounded following economies' reopening from their pandemic lockdowns. According to the company's website, it traded 7.6 million barrels of crude and other oil products per day last year.
In 2021, the IEA predicts Russia will export 4.7 million barrels of crude oil per day. About 2.4 million barrels per day of that went to Europe.
According to rumors, Europe could be next to give up Russian oil, as well. An oil embargo has been discussed as part of a new round of sanctions by the European Commission President, Ursula von der Leyen.If the embargo continues to widen, it could result in higher global oil prices as buyers scramble to find new sources of supply. After Saudi Arabia, Russia is the second largest crude oil exporter in the world and supplied 14% of global demand last year, according to the IEA.
A 14-year high was briefly reached by Brent crude, the global benchmark, in early March, but the price has since fallen to around $107 a barrel.
Coordinated oil releases from the U.S. and IEA members could help lower prices and compensate for the loss of Russian crude supplies.
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