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By Julia Payne and Dmitry Zhdannikov
LONDON, June 24 (Reuters) - Energy trader Mercuria sees the oil market in deficit in July with stock draws reaching about 2 million barrels per day (bpd) as the world economy revives after coronavirus lockdowns, its chief executive told a Reuters webinar on Wednesday.
During the peak lockdown period in April, Mercuria Chief Executive Marco Dunand estimated oil demand collapsed by about 20 million to 22 million bpd, or 20% or more of world demand although analysts provided a range going up to 30 million bpd.
At the height of the lockdown, traders struggled to find space to store about 1 billion barrels of crude and products.
Despite fears about running out space, Mercuria, one of the world’s biggest oil traders, did not completely fill its tanks.
Dunand said an extra 800 million barrels oil, including 200 milion barrels of government reserves, was being stored compared to last year.
He said he expected demand to reach about 95% of pre-coronavirus crisis levels by the end of 2020.
“If OPEC+ were to stick to their current production cuts, we could be drawing to the tune of 3 million bpd in August and September,” he said, referring to curbs by OPEC, Russia and their allies, a group known as OPEC+.
Dunand said he did not expect oil prices to fall below about $40 a barrel in 2021 but said the market was vulnerable to a second wave of lockdowns and monthly OPEC+ discussions on cuts.
OPEC+ could boost production in August by 2 million bpd.
“Gasoline demand has recovered quite quickly. Of course, there are still pockets like Brazil, some parts of the United States and India where demand hasn’t fully recovered. Industrial and diesel demand is lagging behind,” he said, adding government stimulus packages around the world would impact future demand.
The coronavirus crisis has driven some oil firms to bankruptcy, particularly in the U.S. shale industry, and exposed financing weaknesses in some businesses involved in global energy trading.
But major traders have not been affected, including Mercuria which said it raised $1.5 billion in its latest European revolving credit facility, more than the $1.2 billion it sought. (Reporting by Julia Payne; Editing by Louise Heavens and Edmund Blair)