Shell buys Russian oil at record discount

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Shell has broken ranks with Western traders shunning Russian oil to buy a tanker-load of crude from the country at a record discount.

The company paid $28.50 a barrel less than the Dated Brent benchmark for physical oil in the trade, saving millions of pounds at a time when global prices are surging.

Shell – which vowed to end a tie-up with Russian state-owned Gazprom after Vladimir Putin declared war last week – defended the decision on Twitter, saying Russian oil is crucial for its operations.

The company said: “We have also stopped most activities involving Russian oil. However, we currently purchase it and other Russian products for some refineries & chemical plants to ensure that we continue the production of essential fuels and products that people & businesses rely on every day.

“We will further reduce our use of Russian oil as alternative crudes become available to buy, but this is highly complex as Russian oil plays a significant role in global supply and in the current, tight market there is a relative lack of alternatives.”

Although Brent has jumped to a nine-year high of $118 a barrel since the war began, Russian oil is struggling to find a market. The country’s energy industry has so far been left out of sanctions, but many traders are still avoiding it for fear that restrictions may be imposed in coming weeks.

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