50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Energy trader Gunvor more than doubles provision for US fine

Published 08/25/2023, 05:18 AM
Updated 08/25/2023, 05:20 AM
© Reuters. FILE PHOTO: A 3D printed oil pump jack is seen in front of displayed stock graph in this illustration picture, April 14, 2020. REUTERS/Dado Ruvic/Illustration/File Photo
CL
-

By Julia Payne

BRUSSELS (Reuters) - Global energy trader Gunvor's first-half net profit slipped to $803 million from $841 million a year earlier, it said on Friday, citing lower price volatility in gas and oil markets, while it more than doubled a provision set aside for a potential U.S. fine.

The United States Department of Justice and U.S. CFTC have been investigating Gunvor's business dealings in Ecuador and subpoenaed the company in 2020.

A former Gunvor employee pleaded guilty in 2021 to what U.S. federal prosecutors called a scheme to bribe Ecuadorean government officials to win business. Gunvor increased the amount set aside to cover an expected fine to $450 million at the end of June, up from $200 million set aside in 2022.

The Geneva-based trader's revenue fell to $61 billion from $106 billion owing to lower gas and oil prices as the market began to normalise after the turbulence caused by Russia's invasion of Ukraine last February.

Gunvor, one of the top five oil traders, achieved record full-year net profit of $2.36 billion in 2022 while rivals such as Mercuria and Vitol also posted bumper profits after the extreme market dislocations due to Western sanctions on Moscow.

© Reuters. FILE PHOTO: A 3D printed oil pump jack is seen in front of displayed stock graph in this illustration picture, April 14, 2020. REUTERS/Dado Ruvic/Illustration/File Photo

Earnings before interest, tax, depreciation and amortisation edged up to $1.83 billion in the first half of 2023, from $1.79 billion in the same period last year.

"While crude oil and oil products trading margins were impacted by lower price volatility, LNG trading continued its strong performance thanks to its profitable book of long-term contracts," the company said, adding that its traded LNG volumes fell.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.