Photo: Shell
Russia might have initiated an attack on Ukraine, but it’s receiving its fair share of international sanctions. Last week several corporations suspended services in the country, including VW Group, BMW, and Volvo. Yesterday, Nissan closed its factory in St Petersburg. Today, Shell has come out to say it will cease buying Russian crude oil.
On Tuesday, the British multinational oil and gas company issued an apology for purchasing cheap crude oil from Russia over the weekend and pledged to stop any ongoing work in the Eastern European country moving forward, BBC reported.
In 2016, Russian reserves held 80 billion barrels of proven oil reserves, equivalent to 60.4 times its annual use. That’s close to 60 years of oil if consumption levels remain the same. As of 2020, Russian oil reserves amounted to 14.8 billion metric tons, making up more than 6% of global world reserves.
Last week, British Petroleum (BP) abruptly abandoned its stake in Russian oil giant Rosneft. Its costly departure marks the end of a successful three-decade-long partnership operating in the energy-resourceful country. Reuters highlighted that the Russian oil giant accounts for about a half of BP's oil and gas reserves and about a third of its production.
Shell CEO Ben Van Beurden said that they were aware that their decision to purchase Russian oil was not right, and they are sorry.
The oil company got a lot of criticism over the weekend for purchasing Russian crude oil at a bargain, well aware of the Ukraine attack. Ukrainian foreign minister posted a tweet condemning the move after information about the trade went public.
Shell CEO admitted that suspending work in Russia is a ‘complex challenge’ and will require collaborative efforts by governments, suppliers, and consumers. He also noted that a transition to a different supplier would take a long time.
Shell defended the move, saying it was critical to avoid market supply disruptions in Europe. At the time of purchase, it did not have an alternative source to satisfy the demand.
Both Shell and BP depend heavily on the Russian oil supply. It is unclear how both companies will compensate Russia’s oil supply moving forward. By Monday, a gallon of gas in the U.S. was retailing at $4 and around $8 in parts of Europe.
In 2016, Russian reserves held 80 billion barrels of proven oil reserves, equivalent to 60.4 times its annual use. That’s close to 60 years of oil if consumption levels remain the same. As of 2020, Russian oil reserves amounted to 14.8 billion metric tons, making up more than 6% of global world reserves.
Last week, British Petroleum (BP) abruptly abandoned its stake in Russian oil giant Rosneft. Its costly departure marks the end of a successful three-decade-long partnership operating in the energy-resourceful country. Reuters highlighted that the Russian oil giant accounts for about a half of BP's oil and gas reserves and about a third of its production.
Shell CEO Ben Van Beurden said that they were aware that their decision to purchase Russian oil was not right, and they are sorry.
The oil company got a lot of criticism over the weekend for purchasing Russian crude oil at a bargain, well aware of the Ukraine attack. Ukrainian foreign minister posted a tweet condemning the move after information about the trade went public.
Shell CEO admitted that suspending work in Russia is a ‘complex challenge’ and will require collaborative efforts by governments, suppliers, and consumers. He also noted that a transition to a different supplier would take a long time.
Shell defended the move, saying it was critical to avoid market supply disruptions in Europe. At the time of purchase, it did not have an alternative source to satisfy the demand.
Both Shell and BP depend heavily on the Russian oil supply. It is unclear how both companies will compensate Russia’s oil supply moving forward. By Monday, a gallon of gas in the U.S. was retailing at $4 and around $8 in parts of Europe.
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