Gunvor Said to Plan U.S. Office as Trader Sheds Russian TiesBy , , , and
U.S. domiciled office underscores severing of Russia links
Oil trader said to plan global expansion with U.S. presence
Gunvor Group Ltd. plans to open a U.S. office as the oil trader moves away from its Russian roots, according to people with knowledge of the matter.
Gunvor is looking for more staff after hiring at least one senior energy trader for the planned Houston office, two of the people said, asking not to be identified because the matter is private. The company is considering opening an office with 20 to 30 people before the end of the year, trading petroleum products and possibly crude, one person said.
The plans to establish the U.S. office come after the company severed links to Gennady Timchenko, the Russian oligarch who co-founded Gunvor with Swedish national Torbjorn Tornqvist more than a decade ago. Timchenko struck a deal to sell his 44 percent stake in the trading house to CEO Tornqvist in March 2014, the day before the U.S. imposed sanctions on the Russian for his ties to Vladimir Putin.
A Gunvor spokesman declined to comment on the plans for a U.S. office. The company has previously denied it has ever had links to Putin.
Gunvor, which has its main trading operations in Geneva, hired gasoline trader James Hutchinson from Valero Energy to join the new office, two of the people said. Hutchinson was formerly a trader at Trafigura.
One of the world’s five largest independent oil traders, handling about 2.5 million barrels of crude and petroleum products a day, Gunvor would join rivals such as Vitol Group and Trafigura Group with a Houston presence. The company reported record profit of $1.25 billion in 2015.
Over the last year, Gunvor has sold the bulk of its Russian assets, including its majority stake in the Ust-Luga oil-products terminal, according to company statements. Russian crude and oil products now account for 12 percent of Gunvor’s trading activity. The company has said 40 percent of the crude it handles originates from North and South America, including the U.S.
Founded 16 years ago by Timchenko and Tornqvist, a former BP trader, Gunvor got its start trading Russian crude oil. At one point it handled about a third of Russian seaborne crude exports, according to the company.
Tornqvist, who now controls about 70 percent of the company, received an “extraordinary restricted payment” after the Russia asset sales generated $1.7 billion, Gunvor said in August last year. A portion of those proceeds were used by Tornqvist as a final repayment to Timchenko for his Gunvor stake, a person familiar with the matter said last month.
Based in Cyprus, with major trading offices in Geneva and Singapore and smaller trading arms in Shanghai, Nassau and Dubai, the company has reduced its dependence on Russian oil in recent years.
In March, Gunvor confirmed plans it would ship U.S. crude from Freeport, Texas to Panama for storage.
Between 2009 and 2011, the company operated a small Houston office that came with its acquisition of trading house Castor. Gunvor later relocated its Houston-based traders to the Bahamas.