Upstart Traders of Russian Oil Had Representatives in Common

(Bloomberg) -- Two of the companies that emerged as key dealers of Russian oil following the invasion of Ukraine have had representatives in common, according to documents reviewed by Bloomberg News, offering a fresh glimpse into the little-known and opaque businesses.

As the fallout from the war upended global energy markets, one of the biggest mysteries across the industry has surrounded the pack of upstart traders that stepped in to handle Russian oil as western commodity houses pulled back. Despite the huge volumes these companies have traded, there is hardly any publicly available information about them or their backers.

Coral Energy is one of the firms that traded large volumes in the aftermath of the invasion, handling millions of barrels of Russian petroleum. However, it said in February that it no longer handles any Russian supply.

This year, Nord Axis Ltd., a Hong-Kong registered company that was incorporated just after Russia’s invasion, has emerged as one of the biggest traders of Russian oil. Nord Axis was unknown in the oil market until Trafigura Group named it as the buyer of its 10% stake in Vostok Oil, a flagship mega project of Russian oil giant Rosneft PJSC.

Now, documents and company filings reviewed by Bloomberg show that a Coral representative, as well as a lawyer who handled work for the trader, have both been directors of Nord Axis — offering new details about the people involved at the companies which played key roles in ensuring Russian oil continued to flow to international markets.

Company filings for Nord Axis show that Adalat Kazimli, a citizen of Azerbaijan, became the owner of all the ordinary shares in May last year before transferring them to a Dubai holding company later in June. He was listed as a director of Nord Axis for a month in May to June 2022. Since Kazimli’s resignation, Istanbul-based lawyer Murat Sayin has been listed as a director of the company.

Power of Attorney

Documents seen by Bloomberg News, dated March and August 2022, show Kazimli held a power of attorney to act on behalf of Coral in Turkey, and signed documents as the company’s representative. They also show Sayin as a lawyer working on behalf of Coral on Turkish business.

Responding to requests for comment, Coral said it has no relationship with Nord Axis.

Coral said that Kazimli acted as its agent on certain transactions. “Mr. Kazimli is a well-known commodity trader in the Turkish market. But he has never been employed nor holding any position at Coral.”

“Mr. Sayin, being a prominent attorney in the energy industry, was providing legal services to our company, as well as to other commodity trading and oil companies in the Turkish market,” Coral said.

Nord Axis does not have a website and Sayin did not respond to phoned and emailed requests for comment. 

Kazimli said in a response to questions that he was not employed by Coral, and that he resigned as a director of Nord Axis “a long time ago.” Kazimli said he has his own business in Turkey which is not related to either trader.

Buying and trading Russian oil remains legal, despite a series of international sanctions over the invasion of Ukraine, as western governments have sought to ensure that the trade continues.

Nord Axis has become one of the leading traders of Russian oil, moving $3.66 billion of crude, around 586,000 barrels per day in the first four months of this year, according to detailed data on Russian trade and shipping compiled by KSE Institute, a part of the Kyiv School of Economics. That’s almost as much as the total production of Azerbaijan. The company traded $2.19 billion of refined products in January to April, according to the data.

The data shows Coral Energy’s handling of barrels declined sharply from December, down to just an average of 6,100 barrels per day of crude across the four-month period. The company has previously said that it stopped dealing in Russian oil from Jan. 1, but that some vessels carrying oil purchased in the fourth quarter were only loaded and shipped in January.

Nord Axis shot to prominence when it purchased Trafigura’s shareholding in Rosneft’s Vostok project — a deal that closed in July 2022. Company filings show that Nord Axis bought the Singapore holding company of Trafigura’s Vostok stake, including its debt, for just S$1. Trafigura had invested 1.5 billion euros for the stake, which including debt was valued at 7 billion euros before the war.

“Trafigura’s compliance department undertook a full review of the buyer including its ownership and management structure,” Trafigura said in a statement, referring further questions to its announcement on the sale.

©2023 Bloomberg L.P.