Gunvor: Russian oil will find its way to the market one way or another. It always does

Russian oil will continue to enter the market despite the tightening of US sanctions, as Russia has always found ways to avoid restrictions. This opinion was expressed in an interview with Bloomberg by Gunvor Group CEO Torbjörn Tornqvist.

"Over time, you will see that more and more sanctioned Russian oil will find its way to the market one way or another. That's what always happens," Tornqvist said .

Two of Russia's largest oil companies, Lukoil and Rosneft, were hit by US sanctions last month and lost some of their positions in the global market.

Some Indian refineries have said they are postponing purchases, although others have expressed their intention to continue buying Russian oil if it is legal.

"China will continue to buy, some Indian refineries are already buying. No one can say for sure, but I will say that the price reaction and the effects of the sanctions on supply will be relatively minor," Tornqvist said .

Last week Lukoil announced that it has agreed to sell its large international network of oil wells, refineries and gas stations, as well as its trading portfolio to Gunvor, without disclosing the terms of the deal.

If the deal goes through, it will be a major success for Gunvor, which was one of the largest traders of Russian oil before Russia's invasion of Ukraine.

One of its co-founders, Gennadiy Timchenko, was sanctioned by the US in 2014 after the annexation of Crimea. At the time, the US government claimed that Russian dictator Vladimir Putin had investments in Gunvor, but the company has consistently denied this.

Tornqvist said that any fears of the authorities about the preservation of Russian influence on the portfolio will be dispelled.

"We are confident that this agreement meets all the critical requirements," he said .

Tornqvist, who owns about 85% of Gunvor, believes that Lukoil's assets will help his company in the face of competition in the oil markets. This year, trading margins have declined, and Gunvor's first-half profit fell 71%.

However, according to him, some assets may be transferred to other parties.

"It is clear that there are assets that we believe are better kept in other hands," Tornqvist said, adding that it is too early to discuss details.

• According to the Foreign Intelligence Service, Russia's losses from oil sanctions will reach $50 billion a year. This is generally in line with the estimates of Western partners, which were made public by President Zelenskyy ($5 billion per month).