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One of world’s biggest independent oil traders, Gunvor, is joining the Extractive Industries Transparency Initiative (EITI), a voluntary disclosure program for improving transparency of revenues from natural resources.
Gunvor is the second commodity trading house to join the initiative that is also aimed at stamping out corruption in the oil industry, following Trafigura which has been supporting the program since November 2014.
“Gunvor’s support for the EITI reflects our commitment as a trading house to uphold progressive policies and practices in the oil and gas sector,” Torbjörn Törnqvist, CEO of Gunvor Group, said in a statement on Wednesday.
“As one of the largest physical energy trading companies in the world, we recognize we have role in promoting transparency and accountability. The EITI will help us accomplish this in a commercially responsible manner,” said Törnqvist.
As a supporter of the initiative, Gunvor will disclose information about its first purchases from national oil companies (NOCs) for crude oil, petroleum products, and gas.
Now that Trafigura and Gunvor are part of the transparency initiative, it will likely put pressure on the other big oil trading houses such as Vitol and Mercuria to also join.
Glencore is part of the EITI, but a Glencore spokesman declined to comment for Bloomberg on the group’s trading business on Wednesday, saying that Glencore is already EITI-compliant in its mining and oil-extraction operations. Glencore is expected to publish its transparency report for 2017 some time in the next six weeks.
Trafigura, for its part, reported in its latest EITI-related disclosure that it raised the share of direct oil purchases from NOCs in its total trade, while the value of its direct deals with state firms rose by nearly 60 percent in 2016. Trafigura said in its report that its aggregate first purchases from NOCs in EITI countries was US$1.1 billion in 2016, compared to US$915 million in 2015. Aggregate first purchases from NOCs in non-EITI countries, on the other hand, jumped to US$20.1 billion in 2016 from US$12.7 billion in 2015. Trafigura bought 1.5 million bpd from NOCs in 2016, out of its total traded volume of 4.3 million bpd.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.