GCC fuel retailers need to invest more in servicing electric cars, study finds

Emirates National Oil Company launched a new on-demand fuel service called Enoc Link earlier this month. Pawan Singh / The National

Fuel retailers in the Arabian Gulf need to invest more in electric vehicle infrastructure, advanced mobility and in servicing alternative fuels amid growing demand for more sustainable fuels and modes of transport in the region, according to a new study.

"Several trends are impacting and disrupting the fuel retail market globally. Among the most powerful of these are the rise of alternative fuels for mobility, the emergence of new models in mobility and the evolution of heightened consumer expectations around convenience and personalisation," said Mirko Rubeis, managing director and partner at Boston Consulting Group, which published the report, 'Is There a Future for Service Stations?'.

The UAE consumes 12 billion litres of fuel per year serviced by 566 stations, with an average fuel station in Dubai, for instance, pumping 60,000 litres per day, which is double the global average. Fuel retailers in the UAE such as Enoc also sell biofuels, including greener variants of diesel. Electric vehicle infrastructure is also on the rise amid plans by Dubai Electricity and Water Authority to provide more charging stations across the city for a growing pool of users.

However, fuel retailers in the UAE need to reimagine service station networks, said BCG, arguing that a greater range of services will be offered in the future. It says retailers can broaden their offer by leveraging venture capital, M&A, joint ventures, and partner alliances.

"By creating broader asset portfolios consisting of new physical assets like warehouses for last-mile delivery, drones as well as digital assets such as mobility platforms and apps, personalisation platforms, and analytics solutions, GCC fuel retailers will be better positioned to transform their physical and digital products and services," the report added.

Fuel retailers such as Dubai's Emirates National Oil Company have already launched on-demand fuel retail, which will deliver fuel to a client's doorstep – initially to commercial customers who may find it challenging to access regular service stations.

Startups such as Cafu are now offering on-demand fuel to customers in Ajman, Dubai and Sharjah disrupting the traditional fuel retail scene.