Energy trader Vitol reported lower LNG volumes for the last year due to the effects related to the Covid-19 pandemic, but the firm expects demand to grow in the medium term as economies shy away from coal.
Vitol, which entered the LNG market in 2006, said in its full-year report it has traded 10 million tonnes of LNG last year, down 4.7 percent when compared to the year before.
To remind, Vitol’s LNG volumes rose 35 percent year-on-year in 2019 to 10.5 million tonnes.
The Geneva-based firm said its revenue dipped from $225 billion to $140 billion last year as the pandemic destroyed oil and gas demand worldwide.
Its traded oil volumes dropped to 7.1 million barrels per day (bpd), compared with 8 million bpd in 2019.
In addition, total global oil demand fell by 8.8 million bpd in 2020, the firm said.
Shift in energy demand
“The virus shaped our business and our lives in 2020,” Vitol chief executive Russell Hardy said in the statement.
“Whilst much demand has returned and the outlook is positive, the recovery has been slower than many anticipated and near-term uncertainties remain,” he said.
The CEO said that in the longer term, the firm anticipates a shift in energy demand away from liquid hydrocarbons towards power.
“We anticipate that, in the medium term, demand for hydrocarbons such as LNG, natural gas and LPG will grow as economies move away from coal and other solid fuels,” he said.
Hardy said the firm’s focus remains on growing its business whilst maintaining a conservative approach to financial and operational risks.
“We continue to invest in energy segments that are likely to grow as the world transitions to cleaner energy solutions and, to date, have committed over $1 billion of capital to renewable projects worldwide,” the CEO said.
“Alongside this growing portfolio, we are expanding our capabilities in LNG, gas, power and carbon trading. Later this quarter we will publish our first ESG report, in which we provide detail about our refocused business strategy and decarbonisation projects,” Hardy said.
To remind, the firm also recently revealed a new product named “Green LNG” for its liquefied natural gas customers looking to mitigate carbon emissions.
The firm aims to offer all of its LNG customers the opportunity of converting cargoes to “Green LNG” through offsets.