• 3 minutes Australian power prices go insane
  • 7 minutes Wind droughts
  • 11 minutes  What Russia has reached over three months diplomatic and military pressure on West ?
  • 9 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 3 days Is Europe heading for winter of discontent with extensive gas shortages?
  • 6 hours "The Global Digital ID Prison" by James Corbett of CorbettReport.com
  • 3 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 4 days "How China Could Send LNG Prices Into The Stratosphere" by Irina Slav
  • 3 days "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 4 days The Federal Reserve and Money...Aspects which are not widely known
  • 5 days How Far Have We Really Gotten With Alternative Energy
  • 7 days "Oil-funded Rockefeller Foundation centers fight for climate" - Associated Press

Trading Giant Gunvor Raked In Profits During Oil Price Crash

One of the world’s largest independent commodity traders, Gunvor Group, benefited from the oil price crash, booking “substantial earnings” in the second quarter, co-founder and chief executive Torbjörn Törnqvist wrote in an email to employees, reported by Bloomberg.

The biggest commodity traders typically profit from a glut in oil markets as they store oil to sell at higher prices in the future. In Q2, the oversupply on the market reached record highs as global oil demand crashed in the pandemic and Saudi Arabia and Russia briefly fought a price war for market share, which also contributed to the glut and to the oil price collapse.

During the ‘peak lockdown’ period when every major economy except China was under lockdown in late March and early April, the oil market was in a state of super contango. In this market situation, front-month prices were much lower than prices in future months, pointing to a crude oil oversupply and making storing oil for future sales profitable. Traders rushed to charter supertankers for floating storage for several months to a year so they could sell the oil at higher prices later.  

“Given our sizeable fleet of ships under management, this allowed for substantial earnings for the quarter,” Törnqvist wrote in the internal email to the employees of the privately-held Gunvor, as carried by Bloomberg.

Gunvor had an excellent second quarter, with net income massively improved from the US$20 million income in the first quarter, according to Bloomberg sources familiar with Gunvor’s figures.

Mercuria and Trafigura also profited from the oil glut and price slump, Bloomberg notes.

In its 2019 results release last month, Guvnor commented on its operations during the pandemic, saying:

“Trading performance remains strong across all geographies and desks, including shipping (with more than 100 vessels owned or under long-term charter). The European refining sector is expected to remain challenging for the foreseeable future.”

By Charles Kennedy for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News