LONDON (Reuters) – The heads of the world's largest oil traders on Tuesday predicted a modest recovery in oil demand and fixed prices in the coming months or years due to the coronavirus pandemic, but noted that oil demand will peak only in the next decade. Executives from Vitol, Gunvor and Mercuria also said at the annual FT Commodities global summit that they will invest more in renewables. Russell Hardy, head of the world's largest oil trader Vitol, said he had “modest expectations” for oil prices, as he believes consumption will remain broadly flat until next summer. “The market is still fragile and we all know that demand will not be very high, probably until next summer, because life will not change significantly until the end of winter. People will not start traveling a lot again because the pandemic is still going on.” said Hardy. Mercuria head and co-founder Marco Dunan was more pessimistic – he thinks that oil consumption will not return to pre-crisis levels for several years. Dunan expects prices to remain broadly flat at $ 45 a barrel over the next six months. Gunvor CEO Torbjorn Tornqvist said the price of a barrel would hover in the approximate $ 44-49 range until mid-2021. Trading executives say it is too early to predict a peak in oil demand, and it will likely not come until the next decade when renewable energy production spikes.
Russell Hardy referred to a scenario drawn up by BP (LON: BP), according to which in 2030 the demand for oil will be significantly lower than the current one, which will create significant difficulties for producers, investors and OPEC.
“However, the predicted decline in demand is not what we expect, manufacturers still have room to continue to manage the market for the next 10-plus years. The end of the game will probably come a little later, perhaps in 15-20 years,” he said. head of Vitol.
(Julia Payne. Translated by Olga Beskrovnova. Editor Anna Kozlova)