Trading firm Vitol has started taking delivery of oil from Russia’s top producer Rosneft under a new long-term supply deal as the two companies deepen their cooperation.

Vitol signed a deal in September to buy nine million tonnes per year of Urals and ESPO blends, plus the Sokol grade, from Rosneft. That is equivalent to 180,000 barrels per day (bpd).

The two companies have been deepening ties this year. In June, Rosneft signed a preliminary agreement to sell a 5 percent stake in Vostok Oil to a consortium of Vitol and Mercantile & Maritime, and planned to finalise the deal this autumn.

Trafigura, another global trader and a longstanding partner of Rosneft, bought a 10 percent stake in Vostok Oil for 7 billion euros ($8.1 billion) earlier this year.

The new deal with Rosneft is the first for Vitol in eight years after its previous five-year supply agreement with the Russian state oil company signed in 2013.

“The new deal gets Vitol back on the map as a major buyer of Russian oil”, a source with another trading firm said.

The annual supply volume under the new agreement is more than twice as high as the deal back in 2013, when Vitol struck a deal to lift 20 million tonnes of oil from Rosneft over five years. The duration of the new deal was not immediately clear.

Under the agreement, Vitol will load 400,000 tonnes of Urals from Baltic ports, 80,000 tonnes from the Black Sea port of Novorossiisk, and 300,000 tonnes of ESPO Blend from Kozmino port. The volumes and grades Vitol will receive will then vary month to month.

The deal may also include some oil products next year, but the volumes and product types were not immediately clear.

Rosneft has said it is in talks with other big investors about joining Vostok Oil, one of Russia’s biggest oil projects.

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6th October 2021