Vivo Energy's revenues in the Kenyan market dipped by $233 million (Sh36.49 billion) in the year ended December 2023 as a weakening shilling and depressed demand for fuel hit the oil major.
The multinational says its Kenyan unit booked revenues of $1.557 billion (Sh243.87 billion using the exchange rates at the end of the review period), a drop of 13 percent from the $1.79 billion (Sh221 billion) made in 2022.
Vivo sold 1.342 billion litres of fuel in Kenya compared to 1.49 billion litres a year earlier, in the same period that the shilling significantly weakened against the dollar— the currency used to pay for fuel imports.
"A challenging and volatile 2023 landscape across many of our markets; a shortage of the dollar and depreciation of the shilling," said Vivo Energy.
Vivo Energy, like other oil firms, grappled with a fast-falling shilling against the dollar in the period under review, with the local currency closing last year at 156.63 units to the greenback compared to 123.43 units at the start of the year.
A weaker shilling increased the costs of importing refined fuel, which, coupled with falling demand for fuel, hit the sales and earnings of oil marketers in hard currencies.
Fuel prices hit a record high last year as the cost of a litre breached the Sh217 mark, forcing consumers to reduce consumption of the commodity.
This is the first time in three years that Vivo Energy has posted a drop in revenue from the Kenyan market.
Vivo Energy became the second oil major to disclose the impact of the weak shilling and sky-high prices of fuel last year.
Rubis last month reported that its revenues for the Kenyan market last year dropped 11 percent to €886 million (Sh153.6 billion).
Vivo is the biggest oil dealer in Kenya, with a market share of 22.07 percent as of December, ahead of TotalEnergies Marketing Kenya at 14.88 percent. Rubis is third with a share of 14.05 percent.
The three oil majors are locked in a vicious fight for control of the Kenyan market in a battle characterised by the opening of new stations next to each other in the country's major cities and highways.
Kenya is the second biggest market for Vivo Energy in Africa after Morocco in terms of both fuel consumption and the number of fuel stations. In Kenya, Vivo Energy closed the year with 315 stations, compared to 286 in 2022.
The oil major sold 2.22 billion litres across its 421 stations in Morocco last year, making the North African economy its biggest market.
