By Dmitry Zhdannikov
DAVOS, Switzerland Jan 25 Mercuria is seeking
to sell up to a fifth of itself to a strategic investor within
the next six months and is also looking to increase partnerships
with China, its head said on Friday.
Marco Dunand, president and chief executive of Swiss-based
Mercuria Energy Trading, told Reuters the company has grown
rapidly to become one of the world's top five energy traders
expanded again last year.
"There is more interaction between various energy sources.
In order to properly understand it, you need to trade across all
energy sources," he said on the sidelines of the world economic
forum in Davos.
The firm's turnover was around $100 billion in 2012 and it
traded 156 million tonnes of crude oil and products. In 2011,
the revenue was around $75 billion and $47 billion in 2010.
Non-oil business represented 50 percent of Mercuria's
business and the regional split of business was roughly a third
between Europe, Asia and the United states, he said.
He also said the company was looking to expand business and
partnerships with China after the sale of half its terminal
business in Europe to China's Sinopec. The two are now looking
at partnering at a terminal in China.
Dunand also said oil prices were unlikely to fall below $90
per barrel in the next couple of years, held in check by the
marginal cost of producing oil and by supply from the
Organization of the Petroleum Exporting Countries.
"For the foreseeable future, by that I mean a couple of
years, $90 per barrel will be the floor for the oil price,
capped by the marginal production cost, while OPEC will play a
swing role," Dunand said.
Further ahead oil could rather face downward pressure as the
cost of fracking, breaking up rock formations to extract the oil
and gas they contain, becomes cheap and OPEC's spare capacity
"Saudi Arabia has the capacity to cut further to support
prices but if the shale oil revolution starts getting outside of
the U.S. and particularly in China and Russia they will have to
rethink that strategy. They cannot continue cutting eternally to
the benefit of the others," he said.
Tensions around Iran have been supporting the prices in the
past years, but the impact might diminish as the United States
has said it was ready to release fuel from its Strategic
Petroleum Reserve to protect the world economy should oil prices
"With a potential SPR release and OPEC spare capacity
rising, Iran's production can in theory fully disappear from the
market. Therefore, Iran might have to start negotiations,"
He also said new trends in the oil industry were constantly
emerging at a great speed because of the U.S. shale revolution.
"We have see gasoline fixtures from Houston to Libya. It becomes
very interesting as the U.S. emerges as a very large products
exporter," he said.