Published by Global Banking & Finance Review®
Posted on November 5, 2025
1 min readLast updated: January 21, 2026
Western sanctions on Russia and Iran result in record oil storage on ships, preventing a global supply glut, according to Gunvor's CEO.
By Yousef Saba
ABU DHABI (Reuters) -Western sanctions on Russia and Iran are creating record volumes of oil kept in floating storage, preventing a supply glut from forming in global markets, Gunvor Group's CEO said on Wednesday.
The European Union, United Kingdom and the United States have imposed a raft of sanctions against Russia over its war in Ukraine, with the latest U.S. embargo targeting Russia's two top oil producers Rosneft and Lukoil last month.
"Through the sanctions that we've had around the world, an enormous amount of oil is stuck and dislocated," Torbjorn Tornqvist, CEO of Swiss-based commodities trader Gunvor Group, told the ADIPEC energy conference in Abu Dhabi.
"This is unprecedented, the size of that. Therefore, obviously, if all sanctions would disappear, this market would clearly be quite oversupplied," he added.
(Reporting by Yousef Saba; Editing by Muralikumar Anantharaman and Kim Coghill)
Floating storage refers to the practice of storing oil or other commodities on ships instead of on land. This method is often used when there is an oversupply or logistical challenges in transporting the goods.
A supply glut occurs when the supply of a commodity exceeds its demand, leading to a surplus. This can result in falling prices and is often caused by increased production or decreased consumption.
Gunvor Group is a global commodities trading company that specializes in the trading and logistics of oil, natural gas, and other commodities. It plays a significant role in the energy market.
Sanctions can disrupt oil supply chains, leading to changes in pricing and availability. They may cause oil to be stored in floating storage, preventing a supply glut and affecting global market dynamics.
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