PARIS, May 28 (Reuters) — French oil giant TotalEnergies made a significant move to purchase a large amount of Middle Eastern crude oil in March, as traders recognized the U.S. Navy gathering ships near the Gulf in Febr...
PARIS, May 28 (Reuters) — French oil giant TotalEnergies made a significant move to purchase a large amount of Middle Eastern crude oil in March, as traders recognized the U.S. Navy gathering ships near the Gulf in February. This was shared by CEO Patrick Pouyanne in an interview with the French newspaper Le Figaro.
“Our oil traders, whose job is to notice market changes, saw the U.S. Navy positioning its ships around the Persian Gulf in February. They decided to go against the current market trend, which was declining, and start buying oil, anticipating that something significant was about to happen,” Pouyanne explained.
The conflict in Iran escalated on February 28, when the United States and Israel conducted extensive airstrikes on Iran.
In March, TotalEnergies was the only buyer of Middle Eastern crude, as the Iran conflict sharply reduced supply. The company purchased approximately 70 cargoes of Oman and Murban crude, amounting to around 35 million barrels, trade data indicated. This significant buying helped push the benchmark Dubai price to a record high of nearly $170 per barrel.
The Financial Times reported in March that Total made over $1 billion from this trading activity by utilizing financial instruments like futures, options, and swaps to bet on rising oil prices.
On May 19, The Wall Street Journal noted that the U.S. Commodity Futures Trading Commission was investigating a spike in oil futures trading just before U.S. President Donald Trump postponed strikes on Tehran in March, and was looking into at least three firms, including Total Oil Trading SA.
A spokesperson for Total mentioned on May 20 that the company was unaware of any investigation and emphasized that it strictly adheres to compliance rules. Total did not respond to requests for comments on Thursday.
Last month, TotalEnergies announced a 29% increase in its first-quarter net income, primarily driven by trading activities in March, which capitalized on rising oil prices due to the closure of the Strait of Hormuz amid the Iran conflict.
“Things could have gone poorly because if the Strait of Hormuz had shut down immediately, we would not have been able to fill our cargoes in the region,” Pouyanne told Le Figaro, referring to the company's substantial oil purchases in March.
Pouyanne added that due to Total’s vertically integrated structure, the company could use its assets to receive oil deliveries at the Fujairah terminal in the United Arab Emirates, located just outside the Gulf.