Independent Petrol Retailers Now Own a Fifth Of Europe's Petrol Filling Stations

Major oil companies (ExxonMobil, Shell, BP, Total and Chevron) now own just a third of Europe’s petrol filling stations, according to the latest research from global real estate advisor CBRE.

Europe’s largest oil companies are now placing greater emphasis on upstream activities, namely exploration and production, shifting focus from downstream retail activity, by exiting from less profitable real estate sites. This is illustrated by Shell announcing the potential divestment of its Italian service station portfolio and Esso’s sale of 45 sites in the UK to Euro Garages in a consolidated portfolio deal this year.

Such divestment by major oil companies is creating opportunities for independent petrol retailers, who now own exactly 20%, of all petrol filling stations across Europe, compared to 16% in 2007. Across the same period major oil companies’ market share decreased 11%, from 43% in 2007 to 32% today.

This trend is most pronounced in less mature European markets, with independent petrol retailers having the strongest foothold in Bulgaria, where they account for almost two thirds of filling stations at 64%. In Czech Republic the figure is 56%, and over a third of petrol filling stations have been acquired by independents in Hungary, Belgium, Poland and Romania.

In contrast, major oil companies are opting to retain a stronger presence in Europe’s most mature petroleum markets including Denmark and France where just 6% and 13% of filling stations are owned by independents.

The shift of petrol filling station ownership from major oil companies to independent retailers is likely to result in an increase in retail provision at many of these sites. One provider, Polish-based Grupa Lotos has recently announced plans to develop its non-fuel business due to declining fuel margins.

As larger independent retailers increase investment to expand their convenience retailing and provide better quality stations, further growth of the independent network is expected. This will keep a check on prices and provide genuine pricing competition. However, as the independent retailers grow they are expected to assume as much market dominance as the oil companies.

Simon Galway, Executive Director, Global Corporate Services, CBRE, commented:

“The macro-economic environment continues to present challenges for corporates. This is why real estate portfolios are being examined, across all sectors, to seek ways to control costs. In the petroleum sector, we envisage that major oil companies will continue to optimise downstream real estate portfolios as they separate retail and production activities, with independent petrol retailers poised to capitalise.

“Many European markets, most notably Germany, Denmark and the UK, development of alternative fuel sources will lead to the need for new distribution networks, and utilising existing filling stations. For this reason, we expect major oil companies to retain some visibility across these markets, so they are in a position to benefit from these developments.”

Click here to read MarketView