Energy traders dig in for a long Iran war - FT中文网
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Energy traders dig in for a long Iran war

Vitol, Trafigura and rivals expand credit lines in anticipation of prolonged disruption to global oil and gas flows
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{"text":[[{"start":7.55,"text":"The world’s largest independent energy traders are preparing for a long war in the Middle East and a protracted disruption to energy flows, while positioning their operations to profit from the uncertainty. "}],[{"start":18.6,"text":"Vitol, Trafigura, Mercuria, Gunvor and others, whose role trading and transporting energy around the world has been severely tested by Iran’s blockade of shipping through the Strait of Hormuz, said they were deepening their credit lines with banks and considering how to protect their employees from burnout. "}],[{"start":37,"text":"“We have been preparing for a long war scenario,” said Jeff Webster, the chief financial officer of Gunvor, at the FT Commodities Global Summit in Lausanne."}],[{"start":46.45,"text":"He added that the firm had extended its borrowing capacity at the start of the conflict so it had the firepower to handle a surge in energy prices, and was now “looking to put in place” additional borrowing facilities as the potential end of the conflict remains mired in doubt. "}],[{"start":62.6,"text":"“We are prepared for every scenario,” Webster added. "}],[{"start":65.9,"text":"Trading houses rely on billions of dollars in credit lines to finance the vast quantities of oil, natural gas and other commodities they move, and in times of crisis can face higher margin calls if positions move against them. A single supertanker can carry more than 2mn barrels of oil, worth in excess of $200mn at current prices."}],[{"start":88,"text":"The trading houses were speaking on Wednesday after US President Donald Trump extended a ceasefire indefinitely for further negotiations."}],[{"start":96.6,"text":"But there was no easing of the tension in the strait, where shipping has been halted both by Iranian threats of aggression and a US naval blockade. On Wednesday, oil prices jumped back above $100 a barrel after Iran claimed to have seized two container ships in the Gulf. "}],[{"start":null,"text":"

"}],[{"start":113.94999999999999,"text":"While the companies all said they hoped for a quick resolution to the crisis, they underlined how they needed to be prepared for the worst. "}],[{"start":121.54999999999998,"text":"Stephan Jansma, the chief financial officer of Trafigura, said the company was focusing on becoming “anti-fragile”, and now had “higher liquidity” than before the conflict began. “The way we have to manage the company is by that [long war] scenario,” he said."}],[{"start":138.64999999999998,"text":"Jay Ng, his counterpart at Vitol, said he was looking for solutions to tackle burnout among traders, who had spent seven weeks managing huge gyrations in energy prices."}],[{"start":149.54999999999998,"text":"“We have to be mindful of the mental health and physical strength of our colleagues,” Ng said."}],[{"start":155.2,"text":"“When people get exhausted they make mistakes,” he said, adding that he had yet to find a solution."}],[{"start":161.39999999999998,"text":"Despite the challenge, trading executives were also quietly optimistic about how the war in the Middle East would impact their financial performance, which typically benefits from volatility and uncertainty. The large trading houses made record profits during the energy crisis of 2022 and 2023, when the Russian full-scale invasion of Ukraine sent gas prices rocketing."}],[{"start":185.14999999999998,"text":"“From the perspective of earnings for a business like ours, these types of events are positive,” said Bill Reed, chief executive of Castleton Commodities International, a US-based power and gas trading group, which operates around the world."}],[{"start":198.74999999999997,"text":"Richard Holtum, chief executive of Trafigura, said he was “extremely happy” with the company’s financial performance this year, including its oil trading division. "}],[{"start":208.14999999999998,"text":"Marco Dunand, chief executive of Mercuria, said he expected the company’s return on equity this year to be between 25 per cent and 50 per cent. That would imply profits of between $2.3bn and $3.2bn. Last year, Mercuria made a profit of $1.5bn for the calendar year."}],[{"start":227.84999999999997,"text":"At Gunvor, the company made more gross profit in the first quarter than the $1.6bn it made in the whole of last year."}],[{"start":235.94999999999996,"text":"Some traders believe the next 60 days will be critical, as the severity of the energy crisis becomes clearer to financial markets."}],[{"start":244.29999999999995,"text":"Crude oil prices initially surged towards $120 a barrel but have been whipsawed by attempts by the White House to keep fuel prices in check, including taking part in the release of hundreds of millions of barrels of oil from strategic reserves."}],[{"start":258.59999999999997,"text":"“We will see a sudden repricing at some point,” said one senior trader."}],[{"start":263.24999999999994,"text":"Others noted that governments were also preparing themselves for a drawn-out crisis by not releasing further strategic oil reserves or subsidising fuel or food until absolutely necessary. "}],[{"start":275.54999999999995,"text":"“I do not see any immediate end to this conflict,” said Guillaume Vermersch, the chief financial officer of Mercuria. “There is a lot of confusion and geopolitical interests that are conflicting.”"}],[{"start":286.59999999999997,"text":"Richard Dolcetti, CCI’s chief financial officer, said their traders had to “think about if this goes on for days, months or years . . . and make sure we cover those extreme scenarios”."}],[{"start":298.04999999999995,"text":"One banker said they were now working with clients to be ready to bid aggressively for oil and gas shipments if supplies become scarce in future, adding that they had advised traders on how to speed up their payment systems. "}],[{"start":311.15,"text":"“You need to be quick to pay,” they said. “Or you will lose deals.”"}],[{"start":322.4,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776913652_9532.mp3"}

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