Robust Fuel Sales Drive Profits for Oman’s Oil Marketing Companies in Q1 2023
Oman’s oil marketing sector experienced a notable profit surge during the first quarter of 2023, propelled by strong fuel sales nationwide. Oman Oil Marketing Company (OOMCO), Shell Oman Marketing Company, and Al Maha Petroleum Products Marketing Company collectively reported a total net profit of slightly over RO4mn, marking a 13% increase compared to the previous year’s first quarter.
OOMCO, the nation’s largest oil marketing firm, witnessed substantial growth in net profit, reaching RO1.41 for the three months ending March 31, 2023. This represents a remarkable 16% increase compared to the same period in 2022, when the company reported a net profit of RO1.21mn. OOMCO’s group turnover soared by 20% to RO202.4mn, underscoring its robust performance in the market.
Higher sales in the bunker fuel trade and aviation segment were credited as the primary drivers behind OOMCO’s revenue growth. The company expressed optimism about Oman’s future economy and its positive impact on its performance. OOMCO’s five-year strategy (2022 – 2026) emphasizes domestic and international growth, future mobility, sustainability, renewable energy, and operational excellence. The company remains committed to innovation and developing initiatives that enhance its overall performance sustainably.
Al Maha Petroleum also experienced substantial growth, with a remarkable 74% year-on-year increase in net profit for Q1 2023. The company’s net profit surged to RO1.6mn, compared to RO920,000 in the same period the previous year. This notable growth was attributed to the expansion of operations and a diversified product portfolio. Al Maha Petroleum’s sales revenue for the first quarter of 2023 witnessed a 21% increase, amounting to RO120.87mn.
The company’s retail segment exhibited significant improvement, driven by increased sales in retail stations following the easing of movement restrictions. Additionally, retail fuel stations near the borders capitalized on price differences, further contributing to sales growth. However, the fiercely competitive commercial fuel segment remained challenging due to low demand from businesses and service units in the power sector, which turned to gas as an alternative to gas oil.
Nonetheless, Al Maha Petroleum highlighted that the bunkering business and the delivery of additional fuel products to the Duqm Refinery played a crucial role in the growth of the commercial segment. The company remains committed to cost management and operational efficiency, as demonstrated by its successful focus on diversification and expansion.
In contrast, Shell Oman Marketing reported a 31% decline in net profit for Q1 2023, amounting to RO993,000 compared to the RO1.43mn earned in the corresponding period, 2022. This decrease was primarily attributed to fluctuations in aviation fuel prices and an overall rise in direct costs.
Despite the decline in quarterly profit, Shell Oman Marketing recorded a 10% increase in sales revenue, totaling RO122.79mn in Q1 2023. The company continues to navigate the market landscape while prioritizing its commitment to delivering high-quality products and services.