Litasco shut out of oil derivative markets: sources

Litasco shut out of oil derivative markets: sources

London, 29 April (Argus) — Russian-owned oil trading firm Litasco is being excluded from oil derivatives markets, according to sources with knowledge of the matter.

At least one bank has said in recent days that it will no longer offer clearing services for Litasco's oil derivatives trades. For the time being, Litasco is unable to trade oil derivatives and is therefore struggling to hedge its exposure to physical products, leaving it to look for unconventional ways to do so.

Argus has requested a comment from Litasco and the bank in question. The bank has declined to comment.

Although many European oil companies ceased trading with Russian and Russian-owned firms in March and many banks stopped offering credit for the purchase of Russian oil, it is a new development that Litasco cannot trade oil derivatives.

Litasco has been under intense pressure since Russia's invasion of Ukraine triggered a barrage of sanctions. At least one oil brokerage firm has refused to work with Litasco on physical or derivatives trades since March. But Litasco has found ways to continue trading. The UK's ban on ships operated, chartered or owned by anyone connected with Russia left a loophole for subsidiaries of Russian firms incorporated in other countries, meaning