Oil trading companies to see sales increase but profitability decline in 2024, according to the annual report of IOVE which was released today.

The challenges that the sector is expected to face in the next period, according to the same report, include the gradual replacement of liquid fuels movement by electricity, with the penetration of electric vehicles.

Also, the implementation of the new European legislation for the reduction of greenhouse gas emissions from 2027 which – according to IOBE – will significantly increase the prices of products for the consumer (estimated by approximately 15 cents/liter) and will limit the demand for petroleum products.

In particular, the main findings regarding the financial figures and results of the petroleum trading companies in 2024 are summarized as follows:

  • A slight increase in Gross Profitability by approximately 44 million euros compared to the previous year, due to the increase in sales volume by approximately 970,000 thousand tons, maintaining the average gross margin at the same levels (approximately 37 Euro/MT).
  • Decrease in Operating Profitability (Earnings before Interest & Taxes) by 5.2% (95 million euros against 100 million in 2023).
  • Significant decrease in net profit after tax by 50.5% (11.9 million euros vs. 24 million in 2023), with a net profit margin of 0.08% on Sales Value. “A particularly negative impact – according to IOBE – was the maintenance of the ceiling on the profit margin for 4 years, without taking into account the large increase in the operating costs of oil trading companies during the four years”.

Despite the decrease in profitability, the companies’ investments remained stable compared to 2023 (90 million euros), to upgrade the image of the network and add new services to serve consumers, while the gas station network continues the downward trend of previous years. Specifically, the number of gas stations fell in 2024 by 2.5% and reached 4,777 from 4,898 the previous year. At the same time, average fuel sales per station (in thousand metric tons) were reduced by 7%.