Shell to withdraw from Russian oil and gas amid Ukraine war
Energy giant plans to halt all spot purchases of Russian crude and shut its gas stations, aviation-fuel and lubricant operations in the country
Shell PLC said it is withdrawing from dealing in Russian oil and natural gas, saying it would immediately halt all spot purchase of crude from the country and will phase out its other trading and business dealings.
The energy giant previously said it would pull out of a number of joint ventures in the country. On Tuesday, it said it would also shut its service stations and aviation fuels and lubricants operations in Russia, and it won’t renew any Russian term contracts. It said it would find alternative supplies of oil as soon as possible, though it cautioned it could take weeks to fully make up the difference, leading to reduced production at some refineries.
Shell faced a backlash last week and over the weekend when it snapped up a cargo of Russian crude at a bargain price, after many other players had started to curtail their purchases, creating an informal embargo from some buyers in response to Russia’s invasion of Ukraine.
The company on Tuesday apologized for the purchase and said it would commit profits from its Russian oil purchases to humanitarian funds aimed at alleviating the crisis in Ukraine. Shell had previously said it would exit its joint ventures with Russian energy giant Gazprom PJSC.
The U.S. and its allies left energy out of an array of economic sanctions imposed on Moscow in response to the invasion. Many refiners, though, went further, shunning Russian crude. Such self-sanctioning has taken a chunk out of global supplies, pushing prices for international benchmark Brent sharply higher. Traders say it is also causing a backup in Russia’s energy supply chain, prompting refiners to cut back production.
