StarOil Ltd., a newly established company in the Cyprus fuels sector, aims to capture an ambitious 20% of the commercial fuels business with the direct distribution of BP supplies of diesel to fleet operators, home and hotel heating, as well as industrial units, four years after the multinational sold all its local retail operations to Hellenic Petroleum, EKO.
StarOil’s Chairman and majority shareholder, George Petrou, told a press briefing Tuesday that by securing international rates of fuel shipments to
StarOil will have facilities in all towns for the direct supply of high quality fuels such as automotive gasoil (diesel 50ppm), heating gasoil (0.2% sulfur) and various viscosities of light fuel oil.
“Although our rates may seem to be close to the prices posted at petrol stations, we have the flexibility to offer better discounts thanks to a reduced cost base,†Petrou said.
His partner, Costas Kassinos, is well known in Limassol’s industrial and construction sectors and together they intend to capture a significant part of the market of 750,000 tonnes a year that includes diesel, as well as heating and light fuel.
For now, neither StarOil nor BP, that has maintained a presence on the island through its East Mediterranean operations for aviation and marine fuels and lubricants, are keen to re-enter the retail motor fuels market, that accounts for a further 250,000 tonnes consumption a year.
But thanks to the abolition of controls on the fuels market through the PNBS system whereby the state imposed prices on the petroleum companies, new entrants such as StarOil can benefit from low overheads such as cheap use of storage facilities, administration and transport wages based on local rates and the absence of investments worth several million needed to set up a network of petrol filling stations.
Another disadvantage facing the petroleum companies is that with increased profits, costs are also going up, Petrou said.
“We are also using low-cost payment systems and a simple accounting programme instead of multi-million centralized systems,†he said.
“It is not the one-cent-per-litre difference we will charge our clients, but the enormous savings over an annual basis,†he added.
Although BP has not taken a direct stake in StarOil, Petrou who was president of BP Cyprus four years ago, said that the new company is taking advantage of all the marketing services and know-how provided by BP EastMed in
