Rapid network expansion and upstream muscle are the unstoppable forces pushing Lukoil to the fore of fuel retailing in central and eastern Europe (CEE). The firm is the key mover in the region, expanding its site presence by a remarkable 180% over the past three years. But selling petrol is not simply a numbers game: Lukoil is also successfully incorporating a strong shop proposition.
Two recent developments show how western energy utilities are increasingly turning their attention to the opportunities in central and eastern Europe. While shorter term market dynamics mean that these markets often remain challenging environments to operate in, their longer term development potential mean that gaining early mover advantage in central and eastern Europe is a judicious move.
Czech utility CEZ aims to enhance its position as a tier one energy company by focusing on the Balkan states in southeastern Europe. The company hopes that this strategy will complement its existing activities on the Continent and boost its relatively uncompetitive scale. CEZ's strategy is especially astute, given that the growth in the Balkans' demand for energy is unmatched elsewhere in Europe.
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