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Mining and energy trading giant Glencore will be seeking to take on more crude oil trading in Iraq, Iran, Libya and Russia in a bid to boost its trading division, which does not look as good as it did last year, Alex Beard, Glencore's global head of oil, has said at the Reuters Commodities Summit.
“We are currently lifting products from (Iran's) NIOC and private firms and are looking to expand into crude,” Beard said.
With the slump in commodity prices in the past two years, Glencore has been using its trading divisions as a cushion against losses in its mining business.
The group reported earlier this year robust energy trading performance for 2015, “driven by successful execution within an attractive, opportunity rich oil market environment, partially offset by more challenging coal markets”.
This year, however, at least its first half, saw Glencore posting a 47-percent decline in core earnings at its energy trading division, due to more modest oil marketing conditions and challenging coal-trading environment.
Last year was also the year in which the mining and trading giant secured a deal with Libya’s National Oil Company to buy half of the country’s oil output.
Libya’s crude production has been rising since it started reopening export port terminals last month. Oil production is now between 505,000 and 510,000 barrels per day, up from 200,000-300,000 bpd before the reopening of the ports. The National Oil Corporation aims to raise output to 900,000 barrels per day by the end of this year.
Speaking at the Reuters Commodities Summit, Glencore’s Beard said:
“We're very happy with our relationship with NOC and we've been very pleased to support them through some difficult times in the last 12 months and we're open to do more business there.”
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.