Trafigura buys stake in Italy's Saras; access to largest refinery in the Med

London — Global commodity trading house Trafigura has bought a 3.01% stake in Italy's Saras, giving it access to the largest oil refinery in the Mediterranean.

A Trafigura spokesperson confirmed the deal with S&P Global Platts saying the company looks "forward to engaging constructively with Saras as a supportive shareholder."

"While demand for oil and petroleum products and, consequently, refining margins, remain under pressure, the Sarroch industrial site is one of Europe's largest and most efficient oil refineries, capable of producing 300,000 b/d from a broad range of crude oils," the spokesperson added.

Saras operates the 300,000 b/d Sarroch refinery located on the island of Sardinia. A representative at Saras was not immediately available for comment.

Saras, like many other oil companies, has had to revise its costs and investment plans significantly due to the coronavirus pandemic, and its impact on oil demand.

The Sarroch refinery will operate at minimal levels this month and next, to offset the effects of a drop in refining margins over the past few past months, Saras said on Oct. 12.

Trafigura instead has endured a bumper year of earnings so far, benefiting from a spike in price volatility and supply dislocations due to the pandemic. The trading house said its oil and petroleum products division delivered its highest profit on record for the first half of 2020.

Trafigura posted a 27% year-on-year jump in net profit for the first half of 2020 to $542 million, from $426 million a year earlier.