fuel sales

Fuel sales up 6% in ’22, heating fuel sales rise sharply by 13%

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Despite the energy crisis, domestic fuel sales in 2022 regained all ground lost during the lockdown period, registering sales just one percent below those recorded in pre-pandemic 2019.

Following two years of decline, fuel sales ended 2022 at 6.805 million metric tons, up 6 percent compared to 2021, when they had reached 6.402 million metric tons.

Last year’s rise in fuel sales was driven by increased tourism and economic activity. All fuel sub-categories ended 2022 with escalated figures, even gasoline, up by a modest 2 percent compared to 2021, despite increased prices at the pump and a further shrinkage of disposable incomes in Greece last year.

Heating fuel sales registered a 13 percent increase on the previous year, to 1.17 million metric tons, primarily as a result of subsidy support offered to consumers. Also, households equipped with natural gas heating systems were offered incentives to prefer fuel heaters.

Diesel sales rose 6 percent in 2022 compared to 2021, reaching 2.697 million metric tons. Besides the year’s greater tourism and business activity, a temporary discount of 15 cents per liter on diesel, offered until the end of September, also helped push up sales in this fuel category.

LPG sales also rose sharply in 2022, by 11 percent compared to the previous year, to 0.875 million metric tons.

Aviation fuel soared by 68 percent in 2022, compared to 2021. Maritime fuel sales rose by 6 percent but were still 21 percent below levels reached in 2019.

Schools, airlines, heating fuel to contain lockdown effects on fuel

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Fuel market officials are hoping certain lockdown exemptions, such as the non-closure of primary schools, plus airline traffic and heating fuel demand, will result in smaller losses for the sector compared to the country’s first lockdown earlier this year.

If the latest measures remain as they stand for the lockdown’s duration of at least three weeks, beginning last Saturday, then the decline in fuel sales is expected to be far milder than the 45 percent reduction experienced during the country’s first lockdown, implemented last March, fuel market officials have projected.

Seasoned authorities estimate the fuel market’s reduction in sales could reach 20 percent.

The ongoing transportation by parents and guardians of primary school students to school, continuation of flights, as well as greater heating fuel needs of household members kept in by the lockdown, are all expected to help contain the drop in fuel sales.

Though these factors may offer fuel professionals some consolation, the fuel market is entering uncharted territory as the eventual duration of the lockdown remains unknown.

Also, a large number of households have yet to recover from the financial consequences of the first lockdown. Their budgets will have tightened.

Lockdown relaxation limits fuel sales drop, tourism pivotal

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Petroleum product traders have experienced a slight improvement in sales figures since the relaxation of lockdown measures at the beginining of May.

During this 13-day period, the fuel sales drop has been contained to 30 percent compared to regular levels, far better than a slump that reached as low as 60 percent in April.

The pandemic’s impact on diesel has been milder. Sales for this fuel are now down 10 percent after dropping 30 percent in April.

Market officials attributed this increase to the first-stage relaxation of lockdown measures. Also, the general public has remained apprehensive about using public transport, prompting a further rise in the use of private vehicles.

Heating fuel sales were up over the past few weeks compared to  an equivalent period last year as consumers took advantage of a massive drop in oil prices to stock up for next winter.

A new extension granted by the government for heating fuel supply until the end of the month is not expected to make an impact on sales figures. Most consumers have already stocked up and heating fuel prices are now gradually rising.

The pandemic’s development, impact on wider activities and, most crucially, tourism this summer will be instrumental for the future course of fuel sales figures. Current levels are expected to remain unchanged over the next two to three months.

A finance ministry relief measure for payments of special consumption tax and VAT on fuel purchased between May 4 and 19 has not been a great help for market liquidity, officials pointed out.

Many petrol station closures feared as fuel sales plunge

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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.

 

Overall Greek fuel demand continued slide in 2018, falling 5%

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Volume-based fuel sales fell by 5 percent in 2018, driven lower primarily by weaker gasoline and heating fuel demand, which dropped by 5 and 17 percent, respectively, according to data released by SEEPE, the Hellenic Petroleum Marketing Companies Association. The drop in auto diesel demand was milder, falling 1.5 percent.

These latest figures, four months following Greece’s exit from the country’s bailout program, do not bode well for the economy, fuel data being a key indicator of its prospects.

The SEEPE figures could have been worse had it not been for the cold weather experienced in December, which generated a 15 percent increase in monthly demand for heating fuel.

Despite the latest slide in overall fuel demand, the extent of the drop is smaller compared to slumps of previous years during the recession, which has led to successive fuel demand reductions over the past seven years. Heating fuel demand has slumped by a total of 43 percent during this period.

Fuel taxes in Greece have played a big role in this weakened demand. Greece’s Special Consumption Tax (EFK) imposed on fuel is Europe’s third highest, behind the Netherlands and Italy, while the VAT rate, at 24 percent, is the continent’s fifth highest. Greek gasoline prices are the EU’s third highest. Netherlands tops the list and is followed by Italy. VAT rates in most developed EU states range between 19 and 21 percent.

Greece’s VAT-EFK combination is causing double taxation – or tax on taxes.

The influence of euro-dollar exchange rates has impacted fuel prices in Greece at an extent of between 30 and 40 percent. Local retail fuel prices are mainly shaped by fuel taxes to a degree of between 60 to 70 percent, well over the EU average. The fuel tax proportions are lower in member states such as Germany, Finland and France, where disposable income levels are far higher than in Greece.

 

 

Fuel sales down 2.8% in Greece for 9-month period

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Gasoline, diesel and heating fuel sales – in volume terms – are continuing to fall as highlighted by a 2.8 percent decline for the nine-month period compared to the equivalent period last year, official energy ministry data has shown.

Paradoxically, this overall fuel sales drop in Greece coincides with record-breaking tourism industry figures. Locals have cut back on holiday-related domestic travel while many visitors from abroad are opting not to use vehicles during their stays, pundits noted. The increasing trend of all-inclusive travel packages offered by hotels is also believed to have affected domestic fuel sale figures.

Heating fuel registered the biggest drop, falling 23.7 percent during this year’s nine-month period compared to a year ago. Gasoline sales dropped 1.8 percent during the same nine-month period, while auto diesel fuel volume-based sales buckled the trend to rise by 3.5 percent.

September’s overall volume-based fuel sales figure was also down, falling by 3.6 percent compared to the equivalent month last year.

Gasoline sales registered a sharp 5.5 percent drop in September compared to the same month a year ago. The diesel fuel sales drop was milder, slipping 1.7 percent this September.

Local refineries post subdued 1Q results, higher fuel prices now dropping

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The current year did not begin favorably for the local petroleum sector, as indicated by first-quarter results posted by of the country’s two biggest refineries controlling the Greek fuel market.

Drastically reduced heating fuel sales were the main factor behind the disappointing first quarter results, compared to last year, despite an increase in demand for diesel and a modest rise in gasoline sales following an extended downward trajectory.

ELPE (Hellenic Petroleum), which announced its first-quarter results yesterday, reported a 13 percent fuel sales decline, overall, down to a level of 826,000 metric tons, despite operating a greater number of refueling stations, up to 1,749 in the first quarter from 1,737 a year earlier.

ELPE’s heating fuel sales fell by 22 percent in the first quarter, year on year, while diesel and gasoline sales rose by 6 and 2 percent, respectively.

The increased first-quarter sale figures for auto fuels, offering wider profit margins, helped the group’s EBITDA/metric ton margin improve slightly, by one percentage point.

Motor Oil Hellas, the Greek fuel market’s other major player, reported a 6.2 percent overall decline in auto and heating fuel sales.

Auto fuel sales at the group rose by 3.8 percent in the first quarter. Gasoline sales were up by over one percent while demand for diesel increased by 5.8 percent. However, the significant drop in heating fuel sales drove the group’s overall results lower.

Higher fuel prices in the first quarter have been attributed as a factor affecting sale levels in the sector. Prices at local pumps have just begun dropping as lower international prices begin to impact the Greek retail fuel market.

 

Subdued fuel sales not good news for economy ahead of bailout finale

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Latest fuel market figures remain unfavorable, which, to a certain degree, explains the economy’s anemic growth rate. Fuel market data provided for March is not positive given the imminent completion of Greece’s bailout program. Ideally, consumer confidence should now be gaining momentum but it is not.

Gasoline demand in March fell by 1.7 percent compared to the equivalent month a year earlier, diesel demand was down 1.2 percent, while heating fuel demand plummeted 9.8 percent, primarily as a result of the mild winter weather, according to data provided by a market official.

Though the gasoline and diesel demand drops seem trivial, they provide further evidence that the fuel market’s contraction of the past seven years is not yet over.

“I believe 2018 will be slightly better than 2017,” remarked Avin general manager Tolis Vassilakakis, who presented the latest market data during a presentation of the petroleum firm’s new product range and services.

The fuel market’s subdued activity was confirmed by tax revenue figures for March. Energy product special consumption tax (EFK) revenues were 78 million euros, or 7.1 percent, below the target figure as a result of lower consumption levels. Also, VAT revenues stemming from petroleum products were 13 million euros, or 2.8 percent, below the target figure set for March.

Over the course of the first quarter, volume-based gasoline demand rose by 1.9 percent, diesel sales were up 5.8 percent, and heating fuel dropped by 22 percent.

However, the figures for the first three-month period of the year are not considered indicative of the market’s true situation at present. A higher EFK tax rate imposed on fuels as of January, 2017 prompted consumers to rush and fill tanks during the last weeks of 2016, meaning demand was lower than usual at the beginning of 2017. That slump makes the first-quarter figures for this year look better than what they actually are.