LONDON (Reuters) - Vitol’s [VITOLV.UL] 2014 revenue fell to its lowest level in four years, the commodity trader said on Thursday, dropping to $270 billion (180 billion pounds) from $307 billion as lower energy costs and a dip in volumes weighed.
The world’s largest independent energy trader said it handled total volumes of physical crude and refined products of 268 million tonnes, down 2.9 percent from 276 million the previous year.
Natural gas and coal volumes also slipped while power sales rose.
“The rapid slide in the price of crude in the last quarter of 2014 impacted our headline revenue figure,” Ian Taylor, president and CEO of Vitol, said in a statement.
“For a brief time the market structure presented some interesting opportunities for a physical trader, notwithstanding the additional challenges of hedging physical cargoes in a highly volatile market.”
Benchmark Brent crude oil prices LCOc1 fell from more than $115 a barrel last June to less than $60 at the end of December. They hit a post-2009 low near $45 a barrel in January before recovering to near $60 this month.
The privately-held firm’s annual revenue averaged just over $300 billion between 2011 and 2013, with oil prices averaging $110 a barrel during that time. Vitol’s revenue had leapt from $195 billion in 2010 as the firm expanded.
Physical traders have been looking to benefit from the drop in oil prices, however, by storing crude to sell it at a higher price later. Prices in the spot market are well below those for future delivery - a market structure known as contango.
Vitol said that its total number of ship journeys last year - a measure of volumes that strips out the impact of energy prices on revenues - slipped by just 0.2 percent to 6,053 from 6,065.
Taylor said the company is increasingly focused on its physical asset base, including refineries, storage tanks, and energy production, especially in emerging markets.
“Despite an improvement in near-term product demand, questions remain on both the demand and supply sides,” Taylor said.
“We are exploring further opportunities to develop energy infrastructure in a number of growing economies,” he said.
Editing by Jason Neely