Gunvor, one of the world’s leading commodities trading companies, today expressed its withdrawal from continuing negotiations to purchase Lukoil’s international assets. The decision follows increased pressure from the U.S. government, which has previously called Gunvor “the Kremlin’s puppet.” Through a post on X, the firm announced its first major move, that it was dropping its challenge to the acquisition.
Swedish oil magnate Torbjörn Törnqvist and Gennady Timchenko founded Gunvor together. In large part, the company has engendered this controversy because of its past ties. Timchenko, an oligarch with deep ties to Russian President Vladimir Putin, divested his stake in Gunvor. He finalized the sale to Törnqvist in March of 2014. That divestiture was completed amid growing expectations of tough economic sanctions as Moscow moved to annex Crimea from Ukraine. Gunvor continues to insist that Timchenko has no connection, however indirect, to the company.
The firm’s headquarters are also in Geneva, where the firm is further able to continue as a top-tier, largely untouchable player in the commodities trading market. Yet its ties to Timchenko make it a prime target of U.S. officials’ ire. According to the U.S. Treasury Department, Gunvor has “extended ties to the Kremlin.” In rebuttal, the company has vigorously disputed these charges.
In its recent public statement, Gunvor articulated that dissatisfaction with the U.S. government’s allegations. The joint comment letter from the firm blasted the Treasury Department’s comments as “fundamentally misinformed and false.” It pointed to its efforts to be more transparent and independent from Russian control in the last ten years.
“Gunvor is and has always been open and transparent about its ownership and business, and has for more than a decade actively distanced itself from Russia, stopped trading in line with sanctions, sold off Russian assets, and publicly condemned the war in Ukraine.” – Gunvor’s post
The proposal to acquire Lukoil’s assets was contingent on several conditions, including obtaining permission from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC). Gunvor’s announcement about pulling out is a sign of retreat and caution, reflecting tightening markets due to growing geopolitical risks and regulatory pressure to act.
The U.S. Treasury Department underscored its uncompromising stance on the ongoing war in Ukraine. In response to this new aid package, they said, “President Trump has been clear that the war should end right now.”
Gunvor has made the choice to step back from this possible acquisition. This decision is illustrative of their desire to hone-tune their efforts around the challenging web of realities presented by a shifting international sanction architecture and growing concern for companies confronting Russian stakeholders.
