The identity of the Russian companies with which Shell has ongoing contracts remains unclear. On 13–14 March, according to data from Refinitiv Eikon and MarineTraffic, a tanker chartered by Shell Trading picked up more than 700,000 barrels of Urals crude from the Baltic port of Ust-Luga via a loading slot assigned to Surgutneftegaz (a.k.a. Surgut). On 17–18 April, another shipment of more than a million barrels was picked up from Novorossiysk by a Shell-chartered ship, this time via a slot for Siberian Light crude preliminarily assigned to Lukoil.
Shell paid around $600 million to Surgut for Russian crude in 2020, more than to any other single company, according to the leaked data. The independent producer’s shares trade at a steep discount due to longstanding investor concerns over the company’s corporate governance, opaque ownership structure and unusually large cash reserves, which analysts have suggested could be raided by the Russian government, a suggestion the company has strongly denied.
Surgut has a reputation for driving a hard bargain in contracts, which are reportedly negotiated personally by the firm’s senior management in Siberia. In 2018 negotiations, according to unnamed commodity traders speaking to Reuters, the company demanded that buyers take on responsibility for any losses that might arise from sanctions: “They basically said – sanctions don’t matter. Buyers have to find a way to pay, or to return purchased goods, or pay penalties.”
Russia’s fourth-largest oil producer usually sells cargoes via public tender, but has failed to place them in recent weeks and is believed to be making private deals instead, as well as changing its contract terms to grease the wheels of exports to China. There is no suggestion that Shell’s historic payments to Surgut were in any way improper.