The world's largest crude oil trader: the evidence is clear! High oil prices are undermining demand

Victor Group, the world's largest independent crude oil trader, said soaring global fuel costs were beginning to weigh on demand
.

Mike Mueller, head of Asia at Vitol Group, said in a podcast produced by Gulf Intelligence in Dubai on Sunday that consumers were being hit
by rising prices for gasoline, diesel and other petroleum products.
He said:

"There is very clear evidence that exorbitant prices are causing economic pressure, which some call demand destruction
.
It's not just the price of oil that's too high, but also LNG
.
”

This year, refined fuel prices in the United States have hit record highs, and fuel prices in most other countries around the world have also soared, leading to higher
inflation.
Fuel prices rose even more than crude oil, which rose nearly 45 percent to $110 a barrel, in large part because of the Russia-Ukraine conflict and disruptions caused by Western sanctions on Russian crude exports
.
In addition, years of underinvestment in refineries have exacerbated the global shortage
of spare capacity.

The cracking spread for WTI crude has reached $50 per barrel, more than
three times the century average.
On Friday, ExxonMobil said its second-quarter refining revenue jumped $5.
5 billion
.
Mueller said:

"Refining margins are at incredible levels
.
Most people agree that there can be no higher prices
.
”

However, Mueller said fuel prices are likely to remain at current levels if demand continues to recover as China eases pandemic restrictions
.
Russell Hardy, the chief executive of Victor Group, told the media last month that he expects China's oil consumption to increase by 1 million barrels
per day by the end of 2022.

Mueller doubts that China will significantly increase its fuel export quota in the short term, despite the ability of its independent refineries to boost production
.
He said:

"More Chinese export quotas will be welcomed by the market and will help normalize refining margins, but export quotas show no signs of
easing for months.
"