Oil giant Shell has confirmed it will take a hit of up to $5bn (£3.8bn) from offloading its Russian assets as part of plans to withdraw from the country.

The firm has pledged to no longer buy oil, but contracts signed before the invasion of Ukraine will be fulfilled.

The costs of Shell no longer doing business in Russia include quitting joint ventures with Gazprom.

Shell was criticized when it bought Russian crude oil at a cheap price shortly after the war began.

In response to the outrage, the company apologized and pledged to stop buying oil from Russia.

The company said it would cost between $4bn and $5bn to cut ties with the country.

“Shell has not renewed longer-term contracts for Russian oil, and will only do so under explicit government direction, but we are legally obliged to take delivery of crude bought under contracts that were signed before the invasion,” the company said.

The oil firm added that the state of the global oil markets remained “volatile”.

Brent Crude – the global benchmark for oil prices – was trading at about $100 a barrel early on Thursday, but its price has risen to record levels since the war in the Ukraine.

The rise in oil prices is due to Russia being one of the world’s largest exporters of the commodity and fears of supplies being disrupted because of the conflict.

Though the UK gets very little of its oil from Russia, it has been affected by the global rise in prices, which has seen petrol and diesel prices hit record levels.

As part of Shell’s withdrawal plans, the company said previously it would offload a 27.5% stake in a Russian liquefied natural gas facility, a 50% stake in an oilfield project in Siberia and an energy joint venture.

It will also end its involvement in the Nord Stream 2 pipeline between Russia and Germany, which has been put on hold by ministers in Berlin.