From the rundown Neptune Magnet Mall in Mumbai, a giant of international oil shipping has emerged over the past 18 months, seemingly from nowhere.
Since Russia invaded Ukraine, the company has bought more oil tankers than anyone else, elevating itself from an unknown Indian shipping business into one of the world’s largest vessel owners.
Gatik Ship Management owned just two chemical tankers in 2021. By April, it had acquired a fleet of 58 vessels with an estimated combined value of $1.6bn, according to shipping experts VesselsValue.
Yet the origins and ownership of the business are a mystery, while its corporate records are scant. The group was registered as an exporter in India on March 31 this year but does not appear in India’s official corporate registry.
One important clue is that Gatik shares an address in the dreary shopping mall with Mumbai-registered company Buena Vista Shipping, another little-known operation that two years ago reported a little over $100,000 worth of assets.
Who really owns Buena Vista Shipping and who funded the rapid expansion of Gatik’s fleet has perplexed the oil market. But shipbrokers, analysts and commodity traders suspect a link with its biggest client: the Russian oil giant Rosneft.
Gatik’s newly acquired fleet has been used largely to transport oil from Russia, mainly to ports in India, tanker tracking data shows. A Financial Times analysis of data from Kpler, an analytics company, shows the Indian group has shipped at least 83mn barrels of Russian crude and oil products — enough to meet total UK oil demand for more than two months. More than half of that has come from Rosneft. Total figures are believed to be even larger than those in Kpler’s data set.
“It was inevitable after the west’s sanctions that the Russian oil companies would want to get into shipping and I think Gatik is the ultimate example of this happening,” said Viktor Katona, head of crude analysis at Kpler.
“A company in a country that’s deemed friendly to the Russian state, pops up out of nowhere, buys a tremendous amount of tankers in less than a year, and is almost exclusively servicing Russian flows.”
Western sanctions on Russian oil exports in response to Vladimir Putin’s full-scale invasion of Ukraine in February 2022 have completely reshaped global oil markets. Rosneft, the Kremlin-controlled oil champion and Russia’s biggest producer, has been at the eye of the storm. Igor Sechin, its chief executive and a close Putin ally, is one of the Kremlin’s most hawkish and hardline figures — earning him the nickname Darth Vader.
The EU has imposed a series of restrictions on Russian crude, most recently a price cap on oil handled by European companies; Rosneft’s largest customers, Trafigura and Vitol, ditched their agreements with it last year. Following the sanctions, New Delhi has opted to increase its imports of Russian oil, rather than itself imposing sanctions or observing a price cap imposed by the G7.
That is the context in which Gatik emerged. VesselsValue, which tracks tanker sales, calculates that Gatik has acquired at least 56 vessels since March 2022, including 13 vessels in December alone when the EU’s embargo on Russian oil began.
The purchases put Gatik among the largest tanker owners in the world, according to VesselsValue’s Rebecca Galanopoulos. “To put this into perspective, out of almost 14,000 live tankers, the majority of these companies — 1,361 — own fewer than 10 live tankers; only 20 companies, including Gatik, own 50 or more.”
The vessels have also faded into the shadows. As recently as late March, at least 35 of Gatik’s ships held western insurance — a condition of which is adherence to the G7 price cap on Russian oil sales imposed from last December.
By early April, however, none of Gatik’s ships held insurance from any of the recognised large mutual providers.
The ageing vessels in Gatik’s growing fleet had previously transported crude oil all over the world, shipping records show. Once acquired by the Indian group, they started to focus heavily on the Russia-India run.
In doing so, Gatik, which means “speed” in Sanskrit, has helped facilitate one of the most significant shifts in oil flows in decades. Before the Ukraine war, Russia supplied less than 1 per cent of India’s crude. It now accounts for around 30 per cent, according to official trade statistics.
New Delhi has not publicly rebuked Russia over the invasion and in return has benefited from millions of barrels of Russian oil, often sold at a heavier discount than to other buyers.
During the first quarter of 2023, the oil bought by India cost $48.03 per barrel before shipping — $10 less than the average paid by other countries, according to Kyiv School of Economics research based on Russian oil sale records.
Through such deals, India has absorbed most of the so-called Urals crude that Russia previously exported to the EU market. However, some Indian refineries have complained that the heavy Russian blend has been clogging old refinery equipment, according to three people familiar with the matter.
In response, Rosneft’s Sechin in March signed a deal with the Indian Oil Corporation, the country’s top refiner, to increase oil exports to India further and “diversify its blends”. Rosneft was the only Russian oil company with a presence in India before the war owing to its stake in the Nayara refinery in Gujarat, noted Kpler’s Katona. “They already had a foot in the country and they understand how business is done,” he said.
The exact nature of the relationship between Gatik and Rosneft is unclear: Buena Vista, where a staff member said Gatik was “part of” the group, declined to respond to the FT’s queries. But the relationship is clearly close.
Indian officials involved in buying oil for their refineries have told the FT that they have dealt directly with Rosneft — not via intermediaries. The cargoes are also now sold on a “cost, insurance, and freight” basis — meaning Rosneft is responsible for the delivery of the crude to the destination port in India — rather than the “Free On Board” basis Rosneft preferred before the war, when the buyer organised the shipping.
Sechin, a bon vivant fond of wine, hunting and jazz, is widely feared in Moscow for his ties to the security services. A former army translator who speaks fluent Spanish and Portuguese, Sechin has also built Rosneft into an effective tool for Russia’s foreign policy abroad. But the sanctions against the company have created challenges for its role as Russia’s top oil exporter.
Going into the war, Rosneft lacked a significant fleet of its own, relying on buyers to move its oil. It made a brief attempt to build tankers in 2014 with the Russian manufacturer Zveda but the project made little progress, in part because Rosneft never believed the west would risk disrupting global oil flows by blocking Russia’s access to shipping, a person close to Rosneft told the FT.
But the sanctions and restrictions meant Rosneft and other Russian producers not only needed to find new customers but also ships to transport the oil. As the prices paid for shipping Russian oil rose, a global “ghost fleet” of opaquely owned vessels willing to risk sanctions grew to serve this lucrative new market.
In Mumbai, visits to the Indian companies’ offices provide few additional answers on Gatik and Buena Vista. At the former given address for both companies in the mall, post addressed to the mysterious company was piled on the floor. Many shipping companies base themselves at the appropriately named Neptune Magnet Mall.
On March 31, Gatik Ship Management used the abandoned office’s mall address when it registered as a merchant exporter with India’s Directorate General of Foreign Trade.
Recently, Buena Vista has relocated to a new gleaming development in one of the city’s wealthier suburbs that sits next to a lake. An employee confirmed Gatik was “part of” the group before declining to answer further questions. Management wanted to keep a “low profile”, the person said.
Buena Vista did not respond to requests for comment.
Buena Vista’s registered directors are two Indian nationals, Umesh Suvarna Vasu and John Pinto Agnelo, and the company also has an office in Dubai. Nautical job boards show the company recruiting for a variety of roles in the past year, including chief cooks and oilers. People at the mall that housed Buena Vista’s old office said the company had been recruiting heavily before they relocated.
All but two of Gatik’s vessels are registered to single-vessel companies registered in the Marshall Islands and the ownership of those companies is not public.
However, in a 2016 article in Russian Pioneer magazine on his love of jazz, Sechin waxed lyrical about one of his favourite bands, the “magnificent” Cuban son orchestra, the Buena Vista Social Club.
Whether by coincidence or by design, one of the vessels in Gatik’s fleet is called the Buena Vista. The name of its registered owner in the Marshall Islands: Social Club Inc.
Additional reporting by David Sheppard and Max Seddon