(Reuters) – LONDON, June 30 (Reuters) – Mercuria Energy Group had a banner year in 2020, boosted by the COVID-19 pandemic’s severe volatility in oil markets, as well as very strong profits across its portfolio, particularly in gas and electricity. According to a source with direct information and Reuters data, the Geneva-based firm had its best year ever in 2020, earning $786 million, up from $576 million in 2019. The corporation does not usually reveal its financial results, but the 2020 figures have been confirmed. Revenues dropped to around $85 billion from $116 billion the previous year, in line with commodity prices. In 2019, the gross profit on sales was $1.86 billion, up from $1.35 billion the previous year. “This is what I will keep from 2020, a year of tremendous volatility and a very strong live test of our risk management basics… we’ve been testing all of our extreme scenarios and have been successful at that,” said Guillaume Vermersch, CFO. “The outcomes have been really beneficial, and I believe we can be pretty pleased of our increased involvement in ESG-related activities (environmental, social, and governance). It is our primary priority, and it will remain so in 2021 and for the next ten years.” The company, which was created in 2004, is one of the top five global oil merchants, transporting little under 2 million barrels of crude and refined products every day. Mercuria’s traded volumes, on the other hand, have increasingly turned away from oil and toward non-oil commodities such as natural gas, emissions, metals, coal, and power. Mercuria traded a total of 368 million tonnes in 2019. According to Vermersch, oil only accounted for 38% of the company’s sales, and margins were still razor-thin at about 1.5 percent. He went on to say that the company has moved its focus to reflecting power more, with traded volumes of 33,412 terawatt hours in 2020. The company will continue to focus on the energy transition and has a $1 billion pipeline of green initiatives in the works. Mercuria has invested $400 million in green assets related to renewable energy, power grids, and electric vehicles in the last eight months. When 4 billion people were put on lockdown in April of last year, demand for essential commodities, particularly oil, plummeted. Late in the year, prices began to rise again, particularly after a vaccination campaign began. Trading firms had a good year because they were able to profit from both the paper and physical markets, where they were able to keep cheap, undesired oil and resell it at much higher prices. Trafigura, Mercuria’s biggest rival, enjoyed a record year, while Glencore’s (GLEN.L) marketing division had its best year since 2008. Trading profits also provided a much-needed lift to giants like Royal Dutch Shell (RDSa.L) and BP (BP.L) during a difficult year (BP.L). Julia Payne contributed to this report.
Marguerita Choy edited the piece.
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