MEXICO CITY/LONDON, July 15 (Reuters) – The business arm of Mexican state oil firm Petroleos Mexicanos (Pemex) has quickly banned new enterprise with Trafigura AG, based on a doc and a supply, as investigations into the power dealer’s conduct in a number of international locations deepen.
The world’s largest independent commodity traders are dealing with scrutiny globally for alleged corruption after years of investigations into bribes of public officers in a number of international locations in Latin America.
Pemex (PEMX.UL) and different state oil firms have turn into cautious of doing enterprise with retailers, which embrace Trafigura (TRAFGF.UL) and rival Vitol (VITOLV.UL).
Earlier this month, PMI Comercio Worldwide suspended new offers with Trafigura and its subsidiaries till additional discover, based on firm communication seen by Reuters. The doc didn’t state a motive for the ban.
Mexico is the world’s fourth-largest importer of refined oil merchandise and a outstanding purchaser of pure gasoline and liquefied pure gasoline (LNG). Many international buying and selling homes and oil firms purchase Mexican crude from Pemex and likewise provide refined merchandise or LNG for Mexican state firms.
Staff at PMI, which is answerable for Pemex’s gas imports, had been informed to honor current agreements with Trafigura however not tackle new offers as of early July, a supply acquainted with the operations stated.
Mexico’s longstanding enterprise relationships with Trafigura and different power merchants have turn into more and more tough to maintain due to extra layers of compliance progressively imposed by the corporate and its items, a number of sources stated.
The first motive for the elevated scrutiny is that Pemex and its subsidiaries are anxious about publicity to firms beneath investigation for corruption elsewhere, two of the sources stated.
All sources spoke on the situation of anonymity due to the sensitivity of the matter.
Different Pemex items proceed buying and selling with the Geneva-based dealer, one other supply stated. Reuters was unable to find out the frequency and measurement of the buying and selling relationship, however the Americas accounted for 31% of Trafigura’s oil revenues in 2020.
“We see no foundation for brand spanking new enterprise to be suspended with Trafigura and sit up for clarifying the scenario with PMI on the earliest alternative,” a Trafigura spokeswoman stated, including that its compliance requirements have been reviewed by unbiased exterior counsel.
Pemex didn’t instantly reply to a request for remark.
Not less than two cargoes of gasoline and naphtha provided by Trafigura had been scheduled to reach at Mexican ports this month, based on two sources with data of the availability, confirming that shipments bought earlier than the suspension determination weren’t canceled.
As well as, a contract between Trafigura and Mexico’s energy firm Comision Federal de Electricidad to provide LNG to the nation stays in impact, based on two separate sources.
Trafigura’s two largest buying and selling divisions are oil and metals. The corporate traded about 6.4 million barrels per day of crude and refined merchandise within the first half of this 12 months, making it the largest oil dealer after Vitol.
Vitol, the biggest commodity service provider, agreed final 12 months to pay $164 million to U.S. and Brazilian authorities after admitting it bribed officers in Mexico, Brazil and Ecuador to acquire and retain enterprise with state oil firms there.
Ecuador’s state firm Petroecuador has since 2020 eliminated Vitol and Gunvor (GGL.UL) from its suppliers record amid the probes.
President Andres Manuel Lopez Obrador in June reiterated that Mexico desires Vitol to make public the title of the state oil firm official who accepted bribes from Vitol.
PMI quickly banned buying and selling with Vitol in December. Mexico is attempting to renegotiate a few of its contracts with Vitol after the dealer acknowledged paying kickbacks to win enterprise. The ban stays in place, the supply stated. read more
Reporting by Stefanie Eschenbacher in Mexico Metropolis and Julia Payne in London
Further reporting by Marianna Parraga and Ana Isabel Martinez in Mexico Metropolis and Alexandra Valencia in Quito
Modifying by David Gaffen and Marguerita Choy
Our Requirements: The Thomson Reuters Trust Principles.