According to the shipping records, the old vessels that are now part of Gatik’s expanding fleet were previously used to transport crude oil throughout the world. After being taken over by the Indian group, they promptly made the Russia-India route their top priority.Girish Linganna has some reporting to do.
It has shown that a major player in international oil shipping has been operating out of Mumbai’s dilapidated Neptune Magnet Mall over the course of the past 18 months. Since Russia’s invasion of Ukraine, the company, which was originally an unknown Indian shipping concern, has grown to become one of the largest shipowners in the world.
In 2021, Gatik Ship Management possessed a total of just two chemical tankers in its fleet. VesselsValue, a company that specialises in valuing nautical vessels, reports that during the month of April, the company has acquired 58 vessels with a combined value of approximately $1.6 billion.
The history of the corporation as well as its ownership are shrouded in mystery, and there are not many corporate records available. Despite having registered as an exporter in India on March 31 of this year, the group was not found in India’s official corporate registry. This occurred despite the fact that they had done so.
One of the most important clues is that Gatik and the Mumbai-registered company Buena Vista Shipping share an address in the unremarkable retail mall. Buena Vista Shipping is another obscure business that had assets worth slightly more than one hundred thousand dollars two years ago.
Who controls Buena Vista Shipping and who funded Gatik’s rapid fleet expansion is a mystery to the oil market, as is the identity of those who provided the funding. There is much conjecture among commodity dealers, industry specialists, and ship brokers regarding the possibility of a relationship to the Russian oil giant Rosneft, which is the company’s most important customer.
According to data gathered from tracking tankers, the majority of Gatik’s recently acquired fleet has been put to work transporting oil from ports in Russia to ports in India. After analysing the data provided by the analytics company Kpler, the Financial Times discovered that the Indian group is responsible for the movement of at least 83 million barrels of crude oil and oil products originating from Russia. This is sufficient to satisfy the requirements for oil consumption in the UK for more than two months.
Rosneft has contributed more than fifty percent of that total sum. It is hypothesised that the actual numbers are significantly greater than those that Kpler recorded in his data set.
Gatik is the best example of this, according to Viktor Katona, head of crude analysis at Kpler. “It was inevitable that Russian oil companies would want to get into shipping after the west put sanctions on them, and I think Gatik is the best example of this,” said Viktor Katona.
“Out of nowhere, a company in a country that is friendly to the government of Russia appears, buys a huge number of tankers in less than a year, and almost exclusively works with Russian flows.”
In February 2022, Russian President Vladimir Putin launched a full-scale invasion of Ukraine, prompting the West to impose restrictions on Russia’s ability to export oil. The functioning of oil markets all over the world has been significantly altered as a direct result of these restrictions. The Kremlin controls Rosneft, which is Russia’s largest oil company and has been at the epicentre of the controversy due to recent events. Igor Sechin, the CEO of the corporation and a close friend of Vladimir Putin’s, is known as “Darth Vader” because he is one of the most hawkish and hard-line figures in the Kremlin. This earned him the nickname.
The European Union has imposed a number of restrictions on crude oil imported from Russia. The most recent one is a price ceiling imposed on oil that is traded by corporations based in Europe. Both Trafigura and Vitol, two of Rosneft’s largest customers, severed their business ties with the company in the previous year. Following the imposition of the sanctions, New Delhi made the decision to increase its purchases of oil from Russia rather than imposing its own penalties or adhering to a price ceiling established by the G7.
Gatik came into being as a result of this environment. According to Vessels Value, which monitors the market for tankers and keeps a record of transactions, Gatik has acquired at least 56 ships since March 2022. During the month of December, when the EU imposed an embargo on purchasing oil from Russia, thirteen of these ships were purchased.
Because of these acquisitions, Rebecca Galanopoulos of ‘Vessels Value’ asserts that Gatik is currently among the most prominent tanker owners in the world. “To put this into perspective, there are 1,361 distinct corporations that own a total of over 14,000 active tankers. Only twenty businesses, including Gatik, have ownership of fifty or more live tankers.
The vessels had also disappeared into the darkness of the room. As recently as the end of March, at least 35 of Gatik’s ships were adherent to the G7 price ceiling on Russian oil supplies, which had been imposed in December. This allowed the ships to be insured by Western companies. However, as of the beginning of April, not a single one of Gatik’s ships was covered by insurance from any of the major well-known mutual companies.
According to the shipping records, the old vessels that are now part of Gatik’s expanding fleet were previously used to transport crude oil throughout the world. After being taken over by the Indian group, they promptly made the Russia-India route their top priority.
Gatik, whose name derives from the Sanskrit word for “speed,” is credited for contributing to one of the most significant shifts in oil flows that has occurred in the last several decades. Prior to the conflict in Ukraine, Russia supplied less than one percent of India’s oil supply. According to the most recent statistics available, it now accounts for approximately 30 percent of all trade.
There has been an invasion of Ukraine, but New Delhi has not made any public statements condemning Russia’s actions. As a direct consequence of this, Russia has provided India with millions of barrels of oil at a price that is lower than that provided to other consumers.
Before the oil was supplied in the first quarter of 2023, India paid a price of $48.03 per barrel for it. According to a study conducted by the Kyiv School of Economics using records of oil sales in Russia, this was $10 lower than the average price that other countries paid for the commodity.
India has purchased the majority of the crude oil from the Urals that Russia had previously shipped to the EU market thanks to these types of transactions. According to three individuals who are knowledgeable about the problem, certain Indian companies have reported that the heavy Russian blend has caused older refinery equipment to become blocked.
As a direct response, Rosneft’s Chief Executive Officer, Sechin, struck an agreement in March with the Indian Oil Corporation, the largest refiner in the nation, to increase the amount of oil shipped to India and “diversify its blends.” Katona, who worked for Kpler, mentioned that Rosneft was the only Russian oil corporation that had a presence in India before to the conflict. This was due to the fact that the company owned a portion of the Nayara refinery in Gujarat. According to what he had to say, “They already had a foot in the country, and they know how business is done.”
It is not entirely obvious how Gatik and Rosneft are connected to one another. A member of the staff at Buena Vista stated that Gatik was “part of” the group; nevertheless, the company did not respond to the questions that were posed by the FT. However, it is obvious that they are quite close.
According to the Financial Times (FT), Indian government officials who purchased oil for their facilities did so directly with Rosneft rather than going through any middlemen. In addition, the cargoes are sold on the basis of “cost, insurance, and freight,” which indicates that Rosneft is responsible for transporting the crude oil to the port located in India from the point of origin. A “Free On Board” arrangement, in which the buyer is responsible for shipment, was the one that Rosneft preferred to use before the conflict.
Because of his connections to the various security agencies in Moscow, the terror that people have of Sechin, a wine enthusiast who also enjoys hunting and jazz, is widespread. Rosneft has been revolutionised by Sechin, a former army translator who is now fluent in Spanish and Portuguese. As a result of his efforts, Rosneft is now a formidable instrument in Russia’s foreign policy. However, as a direct consequence of the sanctions, the company’s position as the primary oil exporter from Russia has been put in jeopardy.
Rosneft went into the conflict without a substantial fleet of its own, instead relying on buyers to transport their oil for them. Rosneft never believed that the west would risk interrupting global oil flows by denying Russia access to transportation, according to a person who is close to Rosneft. As a result, the company made a brief attempt in 2014 to build tankers with the Russian manufacturer Zvezda, but the project failed. One of the reasons the project failed was that Rosneft never imagined the west would take such a risk.
On the other hand, as a result of the sanctions and restrictions, Rosneft and the other Russian oil companies were required to seek out new clients and ships in order to transport their oil. As the price of transporting oil from Russia rose, an international “ghost fleet” of unidentified vessels that were willing to run the risk of being sanctioned emerged in order to take advantage of the lucrative new market.
You won’t find out very much additional information about Gatik and Buena Vista if you visit the offices of the Indian companies in Mumbai. At the postal address that had been provided in the past for both of the companies, all of the letters that were sent to the unknown company were stacked up on the ground. A large number of shipping companies have their headquarters in the Neptune Magnet Mall.
On March 31, Gatik Ship Management registered with India’s Directorate General of Foreign Trade as a commercial exporter using the mall address of the previous office. This was done so that they could continue to use the same mailing address.
Recently, Buena Vista relocated its offices to a brand-new, gleaming structure in a rich suburb of the city that is located near to a lake. A worker said that Gatik was “part of” the organisation, but refused to answer any further questions after making that assertion. According to the individual, the management wishes to maintain a “low profile.”
Listed on the company’s board of directors are Umesh Suvarna Vasu and John Pinto Agnelo, both of whom are of Indian descent. A branch of the company can also be found in Dubai. According to various nautical job forums, the corporation has been looking to fill a variety of positions, including those of head cooks and oilers. People who frequented the shopping centre where the previous location of Buena Vista’s office reported hearing rumours that the company was hiring a large number of staff members just before to making the transfer.
Only two of Gatik’s ships are registered to single-vessel corporations in the Marshall Islands, and the owners of these firms are unknown. Neither of these companies has any other vessels registered to them.
But in an article published in 2016 in Russian Pioneer magazine about his love of jazz, Sechin waxed poetic about one of his favourite bands, the “magnificent” Cuban son orchestra, the Buena Vista Social Club. The article was about his love of jazz.
It’s unclear if Gatik named one of his ships the Buena Vista on purpose or by accident, but it is definitely one of his vessels. In the Marshall Islands, a business known as Social Club Inc. is the one in charge of it.