The USD 1.1 billion loss in Trafigura's Mongolian oil business

analysisThe group's 2025 prospectus says an internal review and an external forensic investigation found serious misconduct by individuals in the Mongolian petroleum-products business — a complex chain of transactions with a few local counterparties, manipulated data and documents that inflated what Trafigura paid, and concealed overdue receivables — over about five years. The cumulative loss was USD 1.1 billion, and revenue for 2023 had been overstated by USD 1,407 million. ^{1 2 3}

response

Without naming the counterparty or any employee, the group said in October 2024 that it was taking appropriate disciplinary action and that a risk review of higher-risk locations in its network had produced no significant findings; in the 2024 annual report its chief executive said that, having reviewed other higher-risk offices and lines of business, the group was confident the issues were isolated to a self-contained operation in Mongolia. The 2025 prospectus says the group is implementing the recommendations of the external review undertaken in response.

outcome

The group recorded the cumulative USD 1.1 billion loss, USD 357.5 million of it in the 2024 financial year and the rest by restating earlier years; the external investigation was still continuing in June 2025, and the record contains no court case or finding by an authority about the misconduct.

analysisA business news agency reported in November 2024 that the main counterpart was the distributor Lex Oil LLC, which took Trafigura's fuel on credit, that the main oil trader Jononbayar Erdenesuren had been suspended and that the contract of the Singapore-based head of Mongolia, Mikhail Zeldovich, had been terminated. Another agency reported in March 2025, from three sources close to Trafigura and an ownership document, that Lex Oil had belonged to Mr Jononbayar's aunt and that he had lent it over $500 million of Trafigura's money; a Mongolian news site reported in April 2025 that he had been released as executive director of Trafigura Mongolia. ^{1 2 3 4}

qualification

These are press accounts based on unnamed people familiar with the matter; the group has not named its Mongolian counterparty or any employee, and the record contains no finding by a court or authority about any individual. These are press accounts based on unnamed people familiar with the matter; the group has not named its Mongolian counterparty or any employee, and the record contains no finding by a court or authority about any individual. The agency was unable to find documents showing that Trafigura lent funds to Lex Oil.

response

A representative for Mr Jononbayar declined to comment in November 2024, saying he was still an employee of Trafigura and bound by a confidentiality agreement; in March 2025 he did not reply to requests for comment, and a Mongolian news site reported in April 2025 that he had complained to the courts and the police about publications on the missing $1.1 billion, which neither could confirm. Trafigura said it intended to hold its counterparty to its repayment obligation, and that with an external investigation under way it had not been in a position to comment on Mongolia earlier. A Trafigura spokesperson said an external investigation was ongoing and declined to say which staff had been suspended or whether the company knew of the family link. Mr Jononbayar, his aunt, Lex Oil and a lawyer for the firm did not reply to requests for comment. A representative for Mr Jononbayar declined to comment in November 2024, saying he was still an employee of Trafigura and bound by a confidentiality agreement; in March 2025 he did not reply to requests for comment, and a Mongolian news site reported in April 2025 that he had complained to the courts and the police about publications on the missing $1.1 billion, which neither could confirm.

outcome

According to the same account, Trafigura stopped new business in Mongolia, suspended Mr Jononbayar, terminated Mr Zeldovich's contract and recorded a provision of $1.1 billion, while still hoping to recover money from Lex Oil. A Mongolian government source said an investigation had been opened but that it was too early to disclose findings; no result is in the record.

analysisA copy of the Mongolian register shows Eltranika LLC, founded in 2007 and owned by Trafigura Mongolia LLC, which TGPL lists among its principal subsidiaries; Mikhail Zeldovich was its executive director from 2014, Soong Cent-Young has been since February 2025, and Jeremy Weir is registered as its ultimate owner. Lex Oil's registered address was also in a Landmark building on Chinggis Avenue in Ulaanbaatar until June 2025. A 2018 Supreme Court ruling in a dismissal case records Zeldovich as director of Trafigura Mongolia and E. Jononbayar as director of the anonymised employer in 2017. ^{1 2 3 4}

qualification

The register copy does not state the basis on which Jeremy Weir is recorded as ultimate owner; the registered shareholder is Trafigura Mongolia LLC, whose own shareholders are not in the record. The court record anonymises the employer; the director roles are as stated by the employee in her claim.