The country’s petroleum product traders and petrol stations are under extreme pressure as a result of the dramatic sales decline in March, down by as much as 70 percent. The drop is expected to sink deeper, to 90 percent in April. A decline of about 70 percent is projected for May.
These figures, provided by SEEPE, the Hellenic Petroleum Marketing Companies Association, are reshaping the liquid fuels market and could drive many petrol stations out of business.
A government measure postponing check payments by 75 days promises to offer some relief to the sector’s enterprises but does not take into account fuel market’s particularities, namely a heightened level of taxes on fuels, representing about 70 percent of prices.
Petroleum traders, who fully prepay these taxes when purchasing their fuel quantities, now face a liquidity squeeze as most of their customers, such as industrial enterprises, public sector companies and petrol stations, choose to pay by check.
Petrol stations are also under pressure as many of their customers have issued checks for payments. The resulting cash-flow squeeze faced by petrol stations has made it more difficult for them to place orders with fuel traders, who offer limited credit periods.
The measure postponing check payments promises to benefit just over one in six of the country’s 6,000 petrol stations, the 1,200 or so owned and operated by petroleum traders.
Many petrol stations could go out of business if checks issued by their customers are not exempted from the government measure and market conditions do not soon improve, petrol station owners fear.