Gunvor drops $22 billion bid for Lukoil assets after US moves to block deal

Keystone

Treasury calls Swiss trader ‘Kremlin’s puppet’ and says it would block its licence to operate.

Swiss commodity trader Gunvor said on Thursday that it was scrapping its $22 billion bid to buy Lukoil’s overseas assets after the US moved to block the deal.

The Treasury said in a post on X on Thursday that it would not grant a licence for Gunvor to operate Lukoil’s assets “as long as Putin continues the senseless killings” in Ukraine.

It described Gunvor, which was founded by a close ally of Russian President Vladimir Putin but has sought to distance itself from the country, as the “Kremlin’s puppet”.

Gunvor said shortly after the post that it was withdrawing its plan to buy Lukoil’s international assets. The company previously warned of job losses in Europe if the deal did not go ahead.

Lukoil sought buyers for its international businesses, which include assets in the US, after the Trump administration imposed sweeping sanctions on the Russian oil major last month. The measures, which also hit Kremlin-controlled Rosneft, stepped up American pressure on Putin to end his war in Ukraine.

Gunvor said the Treasury’s statement about the company was “fundamentally misinformed and false”, adding that it had “for more than a decade actively distanced itself” from Russian oil trading, sold its Russian assets and publicly condemned the full-scale invasion of Ukraine.

“We welcome the opportunity to ensure this clear misunderstanding is corrected. In the meantime, Gunvor withdraws its proposal for Lukoil’s international assets.”

Lukoil did not immediately respond to a request for comment.

The Treasury statement about Gunvor marked another escalation in Washington’s effort to choke off Russia’s oil exports, a crucial source of money to finance Putin’s war. It also drags Gunvor into the geopolitical fallout as US President Donald Trump seeks to end the war.

The Financial Times previously reported that Lukoil was looking to sell $22 billion of its international assets in Europe and the Middle East to Gunvor after US sanctions hit the company.

The deal would have encompassed Lukoil’s oil refineries in Romania and Bulgaria, its network of petrol stations in the US and Europe, and oil and gasfields in the Middle East, central Asia and Africa.

The Swiss trader was founded in the 1990s by Torbjörn Törnqvist and Gennady Timchenko, one of Putin’s closest allies.

The US Treasury claimed in 2014 that Putin had investments in Gunvor.

After Russia annexed Crimea, Timchenko was subject to US sanctions and sold his stake in the company to Törnqvist, the group’s current chief executive.

A spokesperson previously told the FT that Timchenko had “zero involvement” in the company since he divested his ownership.

The Treasury’s announcement, its first public statement on Gunvor’s proposed deal with the Russian oil major, throws the future of the assets into question as sanctions are set to come into force on November 21.

Last week Gunvor warned that Europe could face job losses and disruption to its fuel supplies if its deal to buy the overseas assets owned by Russia’s Lukoil was blocked.

Törnqvist told the FT in an interview that permits would need to be issued urgently to ensure fuel supplies were not disrupted when new sanctions entered into force.

“It cannot be completed in two weeks. Lukoil’s whole international operations are paralysed. Nobody can transact with them. A lot of jobs are at stake and the refining capacity could be very disrupted,” he said.

Lukoil’s Burgas refinery provides more than two-thirds of Bulgaria’s fuel supply, while its Petrotel facility in Romania accounts for about a third of the country’s refining capacity.

Lukoil operates a network of about 200 petrol stations and convenience stores across the US.

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