Oil trader, Gunvor, pleads guilty to a decade of corruption in the Amazon Region
“Seen on Rio Napo, Ecuador.” (5 October 2010)
Gunvor, one of the biggest crude oil traders in the world, will pay over 600 million dollars in fines for its bribery of government officials in Ecuador. Shell companies and intermediaries were used to pay these officials, who in turn, secured oil purchase contracts. According to the Stand.earth Research Group, such schemes are responsible for devastating oil spills which destroy populated and ecologically fragile areas of the Amazon Forest, and for keeping Latin American countries dependent on fossil fuels and hostage to debt.
Severe oil spills caused by bursts in poorly maintained pipelines have deadly long term effects for nearby indigenous communities, as well as for local fauna and flora. According to Public Eye, an organization dedicated to denouncing the impact Swiss companies and institutions have “on poorer countries”, the “cancer rate in these oil regions was the highest in the world” in the years when Gunvor was bribing officials.
The oil exploitation of the region began years prior with Chevron, whose polluted sites were called out by Roger Waters as he campaigned against Bolsonaro and his catastrophic approach to extractivism in the Amazon Forest. After Chevron’s handover of operations to Petroecuador, nationalization provided no protection to the region from further catastrophe at the hands of Gunvor.
Ecuador, which was already financially vulnerable after relentless exploitation by foreign companies and a failed attempt to make Chevron pay for the damage it had caused, saw itself once again subjugated by western capital. What multinational oil traders did was use their own line of credit to lend money to Ecuador’s nationalized oil company, at predatory interest rates, and, on top of that, bribed officials to get these contracts signed.
These billion-dollar debts at unfavorable interest rates include the need to provide crude oil to the trader. Meaning, not only the Ecuadorian institution is held hostage to the debt itself, but it is also made dependent on oil extraction and the exploitation of its natural resources for years to come.
In contradiction to the capitalist ideology which justifies these extractivist approaches to natural resources in favor of profit and the stabilization of the global economy, there was no competition between the traders. Together, they “monopolized the market of Amazonian crude oil”. As such, in 2009, Gunvor bought one of its sister traders, Castor Petroleum, whose vice-president was eventually tracked down by the FBI and implicated in the court case which led to the 662 million-dollar fine.
Public Eye aptly described this debacle as a “vicious circle that negatively impacts the needs of the population and the environment” in favor of perpetual financial ruin, annihilation of nature, and subjugation of South Americans to western institutions and their profits.
This is not the first time Gunvor has been accused of criminal activity. It 2019, it settled a case of bribery of government officials in the Ivory Coast and Congo for almost 100 million – a case which Transparency International uses as an example of western corporate crimes in “seemingly corruption-free countries”. In 2017, Gunvor was accused of smuggling Russian oil through Belarus to evade taxes. And in 2010, WikiLeaks’ US Embassy cables placed Gunvor as one of “Putin's sources of undisclosed wealth”.
Now that there has been bigger repercussions, a mere 662 million for a company which profits more than a billion a year, with a revenue of more than 100 billion, and which will continue operations normally – where will this fine money go to? Will it be invested in repairing the damage caused in the Amazon and to its people?
By Rémi Bénali. Oil pollution in Lago Agrio, Ecuador. (9 February 2007)
Soon after the bribery scandal came to light, in 2021, Gunvor’s CEO, Torbjörn Törnqvist, told Reuters that he planned on “expanding” his dealings to Russia. That was shortly before Ukraine’s invasion, but it must not have come as a surprise, since Törnqvist had already bought out his Russian partner in 2014 to avoid sanctions over Russia’s annexation of Crimea. Today, he claims to be on a “sustainability journey”, as of 2023 tracking Gunvor’s “supply chain emissions” with the help of an outsourced company dedicated to achieving UN’s sustainable development goals for banks and commodity traders.
Unsurprisingly, nowhere in this sustainability journey is the repair of any actual damage caused to the Amazon Rain Forest and its peoples. There is only a corporate statement about vaguely collecting data on CO2 emissions, admittedly not yet collecting data on methane emissions or any other greenhouse gas. Enterprises which continue to expand even after being denounced as criminal, such as Gunvor, achieve impunity by establishing themselves as indispensable. However, they are dispensable. There is enough money and technology to achieve the climate goals of our dreams with dignity.
The Gunvor Group is now advertising that, for the first time, it’s investing in power generation as an alternative to the fossil fuel dependency they have criminally endorsed and profited from for decades. This is a profit driven decision led by inevitable shifts in the market, shifts which they have spent decades trying to stop or delay at all costs. Is this “journey” better than nothing? What guarantees are there to ensure these corporate statements are not just another scheme that will prolong the life of a destructive and illegitimate enterprise?
Mirna Wabi-Sabi
Mirna is a Brazilian writer, site editor at Gods and Radicals and founder of Plataforma9. She is the author of the book Anarcho-transcreation and producer of several other titles under the P9 press.