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Muscat - Oman's oil marketing sector witnessed a softening of profits last year despite robust growth in revenues on increased prices at the pump, brought on by the deregulation of fuel prices in January last year.
The combined net profit of all three oil-marketing firms - Oman Oil Marketing Co (OOMC), Al Maha Petroleum Products Marketing Co and Shell Oman Marketing – fell 3.5 per cent to RO34.35mn for the year ended December 31, 2016 from RO35.61mn in the previous year.
Sales of all the three firms, however, grew significantly. Total sector revenue stood at RO1.22bn last year, which was higher by RO168mn or 16 per cent from RO1.05bn in 2015.
Oman Oil Marketing, the sultanate's biggest in terms of turnover, on Tuesday posted a 21 per cent decline in net profit for 2016 at RO9.6mn. This compares with a net profit of RO12.21mn for the previous year.
Omanoil's revenue for 2016 grew by 16 per cent to RO425.92mn compared with RO368.15mn in 2015. The company's cost of sales and operating expenses rose 16 per cent to RO418.31mn.
The removal of fuel subsidies coupled with the slowdown in economic activities hurt sales volumes of Oman's oil marketing firms last year. The firms, in their nine-month financial reports last year, said they witnessed a drop in fuel demand which in turn impacted profits.
Al Maha Petroleum reported a five per cent decrease in 2016 net profit at RO8.75mn, compared with RO9.2mn in 2015. Revenue rose 15 per cent to RO402.83mn from RO349.41mn. The company's cost of sales and operating expenses jumped 16 per cent to RO396mn.
Shell Oman, however, bucked the general trend, posting a 13 per cent growth in net profit for 2016 at RO16mn, up from RO14.2mn in the previous year. The company's revenues stood at RO392.9mn, which were 16.9 per cent higher from the previous year's RO336mn. Cost of sales and operating expenses rose 17.2 per cent to RO383.7mn.
© Muscat Daily 2017
