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

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.

Fluctuating fuel prices paint volatile picture, gasoline nears €2 per liter

Fluctuating crude oil prices in international markets have shaped a very volatile domestic fuel market, the instability raising gasoline prices to more than 2 euros per liter on a number of Greek islands, which has prompted questions as to whether such levels will spread to pumps  throughout the country.

Two key developments have unsettled suppliers and consumers, the first being further EU sanctions imposed on Russian petroleum products, to come into effect February 8. The latest measure will ban Russian oil exports to the EU. Brussels is also examining a price cap for Russian oil sold to non-EU members.

A second factor making impact concerns China’s return to energy markets following the country’s departure from a zero-Covid policy and whether the subsequent increase in Chinese demand will lead to shortages.

Analysts have remained indefinite on the possible effects of both these factors.

According to Greece’s monitoring center for liquid fuel prices, unleaded gasoline rose by 0.076 euros per liter between January 1 and January 29, to 1.918 euros per liter.

The rise in heating fuel prices in Greece was steeper, escalating by 0.162 euros per liter during the same period to reach 1.301 euros per liter. A government subsidy cut on heating fuel was the main factor behind this price increase.

The price rise for auto diesel was milder, increasing by 0.026 euros per liter, to 1.821 euros per liter, between January 1 and January 29.

Refineries have begun reducing their wholesale fuel prices as a result of a recent de-escalation in international prices, since January 20, to be passed on to the domestic retail market in coming days. But the duration of this price de-escalation remains unknown.

Heating fuel sales surge 60% as prices drop, gasoline demand down 4%

Heating fuel sales in November increased sharply, by 60 percent compared to the equivalent month a year earlier, driven higher by a significant price reduction of roughly 20 percent since October 15, when heating fuel trading commenced for this winter season.

November’s heating fuel sales increase exceeded that of October, when sales rose by 40 percent compared to the same month in 2021.

Heating fuel prices have dropped to levels below one euro per liter. Suppliers in Athens are currently selling at an average price of 0.979 euros per liter, while the average price around Greece is 1.135 euros per liter, well below the level of 1.412 euros per liter in mid-October.

Demand for gasoline in November fell by 4 percent compared to the same month a year earlier, despite a considerable price reduction for unleaded fuel from an average of 2.105 euros per liter on November 5 to 1.888 euros per liter at the end of the month, a drop of more than 10 percent.

November’s decline in gasoline sales reflected a wider trend in the Greek market. Gasoline demand dropped 7 percent in the third quarter compared to the equivalent period last year.

Auto diesel prices fell even more considerably in November, by 12 percent, to 1.828 euros per liter.

Total liquid fuel sales in 2022 are expected to increase by 3 percent compared to last year, according to rough estimates made by market officials. Heating fuel sales have risen by 9 percent over the year’s first ten-month period.



Fuel cost instability causing market confusion, uncertainty

Wildly fluctuating fuel prices are causing confusion in the petroleum market. Yesterday, officials witnessed an unanticipated plunge in Platts heating fuel prices for the Mediterranean, down by 120 euros per ton, a reduction resulting in a retail price of 1.45 euros per liter for households in Greece, well under Monday’s forecasts that had projected price levels in excess of 1.55 euros per liter.

Market officials have not attributed this sharp price drop for heating fuel to supply and demand factors. With winter trading for this fuel set to begin on October 14, market uncertainty is high.

Meanwhile, diesel prices are moving in the opposite direction, continuing along their upward trajectory. Quite extraordinarily, the cost of diesel now steadily exceeds that of gasoline, despite traditionally being far cheaper.

This unusual trend has been attributed to an increase in demand for diesel amid the energy crisis. An increasing number of industrial consumers in Greece and other parts of Europe are turning to diesel as an alternative to natural gas in an effort to save on energy costs.

Contrary to diesel, demand for gasoline in Greece has fallen, dropping 15 percent, according to market officials, as a result of less vehicle usage. The end of the summer tourism season has also contributed to this decline.


Demand for super unleaded gasoline rises 34.8% during lockdown

Overall petroleum product demand fell by 8.1 percent in 2020 compared to the previous year, from 7.29 million tons to 6.69 million tons, suppressed by lockdown measures, but, in a surprise result, demand for super unleaded gasoline (98/100 octane) increased by 34.8 percent, to 331,664 liters from 246,044 liters in 2019, a development attributed to an extensive upgrade of car models in Greece over the past five years and an increasing trust shown by drivers in higher-octane gasoline.

Demand for regular unleaded gasoline fell by 23 percent, from just over 2 million tons in 2019 to 1.57 million tons in 2020, according to Hellenic Statistical Authority (ELSTAT) figures.

Auto diesel demand declined by 6.5 percent, from 2.73 million tons in 2019 to 2.55 million tons in 2020.

Demand for high-sulfur fuel, used in the shipping sector, fell sharply by 28.7 percent, over the same period, the ELSTAT data showed.

Heating fuel demand also rose in 2020, registering a 15.2 percent increase, to 1.25 million tons from 1.08 million tons in 2019. This demand increase was attributed to lower prices.



Motor Oil launches west Balkan growth plan, under Shell brand, in Croatia

Petroleum retailer Coral, a member of the Motor Oil group, is eyeing west Balkan markets, troubled by gasoline and diesel quality and trading concerns, on the strength of the strong Shell brand name it represents.

The Motor Oil group acquired Shell Hellas in 2010 in a deal licensing the company to market the multinational’s brands. Motor Oil then renamed Shell Hellas as Coral and, approximately four years ago, founded companies in North Macedonia, Albania, Montenegro and Serbia.

Coral’s acquisition of a 75 percent stake in petroleum retailer Apios, holding a 3 percent share of the Croatian market and operating 26 petrol stations in the country, represents the beginning of the Greek firm’s growth plan for the west Balkan region, company officials said.

Croatia, this investment plan’s launch pad, is backed by robust economic projections. The country’s tourism industry has enjoyed solid growth over the past two years, generating increased revenues for petroleum firms.

Beyond Croatia, Coral plans to soon open two petrol stations in North Macedonia, under the Shell brand name. The company is also planning to enter the markets of Albania and Montenegro, where it also maintains the rights to use the Shell brand name.

Coral already operates five petrol stations in Serbia and is preparing to launch an additional six in this country.


Fuel demand dives, heating fuel sales supported by low prices

Fuel consumption, down to unprecedented levels as a result of the lockdown, has produced a nationwide gasoline sales drop of 70 percent this month. The slide in gasoline sales has been even steeper in urban centers, falling by as much as 80 percent.

The reduction in demand for diesel has been milder, limited to levels of far less than 50 percent as a result of ongoing agricultural activities around Greece.

On the contrary, heating fuel demand has stood firm against the wider downward trend, supported by extremely attractive prices that have encouraged consumers to stock up as early as now for next winter.

Heating fuel prices have registered a 24 percent drop since the beginning of the year, falling to 0.815 euros per liter from 1.07 euros per liter.

The heating fuel price reduction in Greece is far smaller than that of international oil prices because a considerable percentage of the local retail price is comprised of taxes.

The heating fuel season ends at the end of April, meaning consumers have about two more weeks to place orders at the current prices.

An OPEC agreement reached last week for a 10 percent reduction in output considerably increases the likelihood of a price rebound. The production cutback puts an end to the Saudi-Russian price war.

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

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.



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

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.


Major fuel demand decline in 2017, signs of life in January

The prolonged bailout negotiations in the first half of 2017 not only impacted bond spreads and business loan interest rates but market sentiment, overall, which has affected fuel consumption levels, officials at Greek petroleum company Motor Oil Hellas noted yesterday while presenting the corporation’s results.

Despite the negative Greek market conditions, the refinery group posted record results as a result of its increased emphasis on exports to make up for lower demand in the domestic fuel market, which appears to be entering a new crisis period.

Overall demand for the corporation’s petroleum products in 2017 fell by 2.1 percent. Gasoline registered the biggest drop, falling 3.1 percent. Diesel demand increased by 0.5 percent while heating fuel, affected by poor activity in December, down by 30 percent compared to the equivalent month a year earlier, fell by over 2 percent, overall.

Latest fuel market data for January showed some signs of improvement for the auto fuel sector but the decline in heating fuel demand was sustained.

Gasoline demand rose by 11 percent in January, diesel demand rose by 23 percent, while heating fuel demand slumped 37 percent.

The significant decline in heating fuel registered for the winter gone by can be attributed to a particularly heavy winter a year earlier, which had boosted heating fuel demand to particularly elevated levels.

Returning to Motor Oil Hellas, overall fuel sales, in volume terms, achieved a new record level in 2017, reaching 13.7 million metric tons, up from 13.04 million metric tons in 2016. The refinery group’s exports exceeded the 10 million mark for the first time, reaching 10.2 million metric tons.


Local diesel prices now EU’s 5th highest from 15th a year ago

The price of auto diesel in Greece has climbed ten places over the past year, from fifteenth highest to fifth on the EU-28 list, an unprecendented leap for an EU member state, according to seasoned pundits.

A year ago, auto diesel prices in the Greek market were marginally higher than the EU average but are now five percent over the common market’s average of 1.243 euros per liter.

Auto diesel was priced at 1.186 euros per liter on December 19, 2016 and has now risen to 1.303 euros per liter, a 10 percent year-on-year increase.

The sharp price increase of the fuel, prompted by tax increases, has caught many diesel vehicle owners who have switched technologies by surprise.

Finland, the UK, Italy and Sweden occupy the EU’s top four places in terms of auto diesel prices.

Greece has also climbed higher on the EU list of gasoline and heating fuel prices over the past year. Last December, gasoline prices in Greece were the EU’s fourth highest and have since climbed a place to third. The price of heating fuel in Greece has risen from ninth to eighth place in the EU since last December.

The price of gasoline in Greece is currently at 1.534 euros per liter, 13 percent over the EU average of 1.359 euros per liter, according to latest European Commission data.



ELPE gasoline refinery west of Athens repaired and operating

The ELPE (Hellenic Petroleum) refinery in Aspropyrgos, slightly west of Athens, yesterday recommenced producing gasoline following repair work to a unit that was struck by technical issues several days earlier.

The repair work needed at the damaged refinery, which produces all of ELPE’s gasoline output, was completed on Saturday.

ELPE is scheduled to announce its 3Q results this Thursday. Analysts have forecast an upward trajectory ahead of new record figures at the end of the year.

An Investment Bank of Greece (IBG) analysis expects ELPE’s 3Q net profit to reach 100 million euros, which would represent a 29 percent year-on-year increase. If the impact of currency exchange rates is removed, the net profit would be 75.5 million euros, a marginal 0.5 percent increase compared to a year earlier, according to the IBG analysis.

It has forecast a 3Q EBITDA figure of 228 million euros, up 15 percent year-on-year, and a net EBITDA performance of 193 million euros.

ELPE is expected to post record figures at the end of the year as a result of the local market’s continuously rising geostrategic importance.

In 2016, ELPE posted an EBITDA figure of 731 million euros, while production reached 14.8 million tons, up 16 percent year-on-year, setting a new corporate group record.