Gunvor Cements Its Role as Biggest Independent LNG Trader
(Bloomberg) -- Gunvor Group Ltd. cemented its role as the world’s largest independent trader of liquefied natural gas, the fastest growing fossil fuel.
The trading company delivered 16 million tons of LNG this year, boosting volumes by 45% from 2018, the company said on Wednesday. Last year, it already topped larger rivals Vitol Group and Trafigura Group Pte Ltd., when its volumes soared by 60%. The increase came even as spot prices for LNG plunged this year amid deepening oversupply.
“Despite the near-term bearish sentiment in the LNG and natural gas markets, Gunvor remains positive on growth of natural gas within the energy mix for future,” Kalpesh Patel, the company’s co-head of LNG, said in a statement.
It marks another year with industry-leading volumes for Gunvor, underscoring that the focus on the super-chilled fuel is paying dividends after the firm overhauled operations in the last three years. Once focused on Russian oil and embroiled in a corruption scandal in the Republic of Congo, the Geneva-based company has reinvented itself as a more diversified trader.
Gunvor also emerged as the largest charterer of LNG vessels this year, with more than 50 bookings conducted in 2019 and 15 ships under time charter now.
The trading house benefited from higher demand in India, which usually increases purchases when prices for LNG decline. India was the biggest market for Gunvor in 2019, with 75 cargoes delivered.
LNG has been in the spotlight of the energy market in recent years as commodity trading houses, oil companies and utilities all set up desks to handle that business.
LNG is booming as plants from the U.S., Russia and Australia are adding supply. Europe is absorbing much of the demand. The boom is also in part thanks to the American shale advances as export volumes from the U.S. made buying and selling more flexible and short-term, helping develop a liquid market.
Still, Gunvor is betting that long-term contracts for both supply and vessels will remain the backbone of the industry.
“We are progressing on a number of long-term initiatives around the world, including expanding our portfolio of vessels secured on a long-term charter,” Patel said.
Trafigura last week said its delivered volumes increased by 27% to 12.6 million tons in its financial year ending Sept. 30.
Glencore Plc boosted its transacted LNG volumes about 83% to 11 million tons this year, Nathan Arentz, the company’s director of natural gas and LNG, said earlier this month. Glencore declined to specify if their traded volumes mean delivered LNG.
Vitol declined to provide its 2019 LNG numbers. The company, which typically reports on its performance in the first quarter, traded 7.8 million tons last year.
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