(Bloomberg) -- Gunvor Group is ramping up its crude oil business, with trading volumes growing particularly out of the US, according to its co-founder and Chief Executive Officer Torbjörn Törnqvist.
Already one of the world’s biggest independent oil traders, Gunvor moved 79 million tons of crude and oil products in the first half, the most on record. The shift was in part due to the expansion of the company - which has built up its equity to $6.8 billion - and was primarily driven by more deals in North America, Törnqvist said.
“We built up a quite substantial export business out of North America, even though we only started three or four years ago,” he said in an interview on the sidelines of the APPEC conference in Singapore on Monday. “We’re building on that and working it into our markets in Europe and in Asia.”
Gunvor agreed to exclusively supply CVR Energy Inc.’s refineries in Kansas and Oklahoma with crude starting this year. It’s also growing outside of the US - signing a financing deal in Gabon for around $800 million and preparing to buy into a network of retail fuel stations in Pakistan.
Törnqvist said the tight $75 to $90 a barrel range that oil had been trading in for most of this year was re-basing lower.
“If you look at where marginal production starts to be affected, and where spare capacity should shrink in a meaningful way - I really feel that you need a lower oil price than you see today,” he said. “And that’s probably below $70.”
Gunvor sees global demand growth for oil at around 1 million barrels a day, markedly lower than expectations earlier in the year. For distillates, the situation is even worse.
“If you exclude the first quarter there is absolutely no demand growth at all in the world on an important product, which is gasoline,” he said. “Consumption in China is not really growing much.”
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