Trafigura Group is a giant of commodity trading. On any given day, it handles enough oil to supply the entire needs of France three times over. Its global reach stretches from US crude oil export infrastructure to fuel stations in more than 20 countries across Africa, Asia and Latin America.
Yet in a distant corner of its empire, far from the attention of top executives in Geneva and Singapore, a crisis has been brewing for some time.
On Oct 30, the company admitted it faces a loss in Mongolia of up to US$1.1 billion (S$1.5 billion), linked in part to suspected fraud by its own employees. Trafigura alleges that staff manipulated payments while concealing a mountain of overdue debts, allowing the exposure to run out of control for years without raising any red flags.
For people inside and outside Trafigura, the revelation was a bombshell. Most shocking was the scale of the likely loss relative to the size of Mongolia's oil market. There are over 100 countries that use more oil than Mongolia, according to data from the US Energy Information Administration, among them Luxembourg and Nepal. Its consumption of about 35,000 barrels a day is worth roughly US$1 billion a year. For Trafigura, Mongolia made up less than 0.3 per cent of all the oil it traded.
This account is based on interviews with eight people with direct knowledge of Trafigura and its activities in Mongolia, who asked not to be identified due to the sensitivity of the subject. On Oct 30, Trafigura chief executive officer Jeremy Weir said the company was "bitterly disappointed" by the situation and was confident it was isolated to the Mongolia business, and the company's investigation is ongoing.
The announcement, confirming an earlier report by Bloomberg, represents a painful sequel to the 2023 revelation that Trafigura had fallen victim to a massive alleged nickel fraud.
Esta historia es de la edición November 05, 2024 de The Straits Times.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor ? Conectar
Esta historia es de la edición November 05, 2024 de The Straits Times.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor? Conectar
South Korea's defence ministry denies preferential treatment for BTS' V
South Korea's Ministry of National Defence has refuted claims that V, a member of K-pop boy band BTS, received preferential treatment while serving in the military.
K-actor Jung Woo-sung admits to fathering model Moon Ga-bi's child
South Korean actor Jung Woo-sung, 51, admitted on Nov 24 that he is the father of South Korean model Moon Ga-bi's child.
Chuck Woolery was the first host of Wheel Of Fortune
Chuck Woolery (right), the affable host of Love Connection, Wheel Of Fortune and other television game shows in the United States, who later criticized liberal values and the US Democratic Party as the co-host of a popular right-wing podcast, died on Nov 23 at his home in Texas. He was 83.
Sole Singaporean contestant Yang Yan eliminated
Idol survival reality show Starlight Boys
Spotlight on two female-directed movies in India
Laapataa Ladies and All We Imagine As Light might have a shot at winning Academy Awards, a rare prospect for the country
For diamond shoppers, yet another choice to make – natural or man-made?
With Thanksgiving marking the unofficial start of engagement season - late November through Valentine's Day is when marriage proposals are common - ring buying is top of mind for many couples considering marriage.
Culture and cuisine in Hanoi
Visit the Vietnamese capital's Opera House and sample offerings from Michelin-starred chefs in Senses of Capella
BUDGET TIPS FOR FAMILY TRIPS
Going abroad? Here are five money-saving hacks for the holidays with your nearest and dearest
How the late Arthur Frommer inspired travellers to 'just do it'
In the 1980s, when I planned my first trip to Europe, I cannot remember which Frommer's travel guidebook I took along.
Tension, pressure, nerve, genius: At the chess c'ship, the wait is worth it
For all the flow of action, all sport involves varied acts of waiting. We wait for the goal in football, the shooter to fire between heartbeats, a snarling Rafael Nadal to uppercut the air in delight.