Japan's largest trading company lost $ 320 million in oil transactions by one trader. Mitsubishi Corp reported expectations of a loss of $ 320 million due to unauthorized transactions in the oil market, which since the beginning of 2019 have been conducted by a trader of one of the corporation's divisions.
A Mitsubishi statement noted that one trader at Petro-Diamond Singapore has repeatedly traded derivatives in the oil market since January 2019 without the knowledge of company management.
At the same time, a Petro-Diamond Singapore employee allegedly hid them under the guise of risk hedging operations, manipulating Petro-Diamond Singapore's internal data and exposing them as transactions with company customers. As noted, the main losses in his transactions began in July 2019 against the backdrop of falling oil prices. At the same time, the fact of unauthorized operations by the trader was established in August 2019. The trader was dismissed from the company in mid-September.
In the comments to Reuters, Mitsubishi representatives called the trader’s unauthorized activity “the first such loss since the company was created.”
These losses may also become the largest in the oil market for one company in 2019. Last year, Sinopec Chinese Corporation reported a loss of $ 700 million in transactions with hedging risks in the oil market.