Energy major Shell has gone back on its previous decision to maintain business relations with Russia in the midst of its invasion of Ukraine, with the company announcing today that it will no longer be purchasing Russian oil and gas. In light of the move, crude imports from the nation are to see an immediate halt.
Last week, Shell was called out for its purchasing of Russian oil, a decision that attracted criticism as Western businesses continue to boycott dealings with the nation in an attempt to economically isolate and weaken President Putin’s regime.
I am told that Shell discretely bought some Russian oil yesterday. One question to @Shell: doesn’t Russian oil smell Ukrainian blood for you? I call on all conscious people around the globe to demand multinational companies to cut all business ties with Russia.
— Dmytro Kuleba (@DmytroKuleba) March 5, 2022
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.Company Profile – free sample
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
Shell’s announcement today included an apology for the purchase and in a statement, Shell CEO Ben van Beurden wrote: “We are acutely aware that our decision last week to purchase a cargo of Russian crude oil…despite being made with security of supplies at the forefront of our thinking – was not the right one and we are sorry.”
“We will work with aid partners and humanitarian agencies over the coming days and weeks to determine where the monies from this fund are best placed to alleviate the terrible consequences that this war is having on the people of Ukraine. Our actions to date have been guided by continuous discussions with governments about the need to disentangle society from Russian energy flows, while maintaining energy supplies.”
The group will also close all service stations operating in Russia, as well as all aviation fuel and lubricants operations in the nation. A withdrawal from Russian petroleum products, pipeline gas, and liquefied natural gas will also be carried out.
The process of extracting itself from Russia is expected to take weeks, particularly in the context of a volatile oil market that has struggled to stabilise since Russia’s invasion of Ukraine. The incursion saw a mass exodus of Western companies from Russian operations, as energy majors including BP and ExxonMobil distanced themselves from the worsening conflict.
As oil and gas exports remain a crucial part of Russia’s economy, sanctions intended to hobble these transactions are being levelled by multiple governments, with the UK Government passing a ruling barring vessels carrying Russian imports, and the US reportedly willing to entirely ban Russian oil imports.