Currently the merge operation is very expensive and requires the equivalent storage space available for the _MERGE image. See the flow on removing snapshot1:

  (raw 10G)
------------------------
| ca8b5daa (snapshot1) |
------------------------
     |            (cow)
     |        ------------
     ---------| 00d83dd2 |----
              ------------   |
                (active)     |
                             | qemu-img convert
    (raw 10G)                |
------------------ <----------
| 00d83dd2_MERGE | -----------
------------------           |
                             | 
                             | rename
 (raw 10G)                   | 
------------                 |
| 00d83dd2 |  <---------------
------------
  (active)

In consequence of the _MERGE image creation, storage can run out-of-space, since many users believe removing snapshots will free some storage space and they do that when the storage is close to the limit. The _MERGE volume is not desired at all in that scenario.

Qemu has support for 'qemu-img commit', wich can commit the changes in a cow image to its backing file. After the commit, we can drop the cow image and use the backing file directly.

Please change the offline merge method to use 'qemu-img commit' instead of the external merge image.