Fuel Market in Ukraine Stable, Prices Not Rising Faster Than in Other Countries - Kuyun

During a recent appearance on Ukrainian Radio, Serhiy Kuyun, the director of the Consulting Group A-95, provided insights into the current state of the fuel market in Ukraine. He emphasized that the country is experiencing a stable fuel situation and is not at the forefront of rising fuel prices when compared to other countries. According to Kuyun, there is an adequate supply of fuel in Ukraine, and prices are increasing at rates similar to those in other nations.

Kuyun highlighted that when examining diesel fuel prices, there was an increase of 23 hryvnias in March of this year in Ukraine. In contrast, prices rose by 30 hryvnias in Poland and Germany, while in the United States, the increase was 20 hryvnias. “This indicates that the growth in Ukraine has been approximately the same as in other countries. In Romania, for example, prices increased by a lesser amount of 10 hryvnias,” he explained.

The director pointed out that as an importing country, Ukraine is entirely dependent on fuel imports, which necessitates close monitoring of global market dynamics. “We do not have any refineries or oil depots, nor do we have reserves like those in Europe or the United States. Nevertheless, we are not 'running' as fast as Europe. Thus, our situation is much better than that on the European continent,” he added.

Addressing the issue of reducing fuel taxes, Kuyun remarked that such a move is currently impossible. “We cannot lower taxes right now because all tax revenues go towards our defense. What could be more important—our defense or allowing someone to travel from point A to point B at a lower cost? I apologize, but I do not understand how one could not grasp this,” he stated. He also compared the economic situation in Ukraine with that of Poland, where, according to him, tax reductions are feasible due to the absence of war and a significant GDP.

Kuyun positively assessed the fuel cashback mechanism, which provides a subsidy of 1,000 hryvnias per month for fuel purchases. “In reality, it is very effective. If this subsidy is applied to trading, the price increase will be minimal. For instance, as I mentioned, diesel prices rose by 23 hryvnias in March, but 13 hryvnias of that increase is covered by the cashback. Therefore, the actual price increase for consumers is only 10 hryvnias. For gasoline, the increase over the month was only 10 hryvnias, and 7.5 hryvnias of cashback offsets this. Thus, the actual increase compared to February is just 2.5 hryvnias. This program is the only effective mechanism, and it truly benefits those who drive less. This means it will be very helpful for low-income individuals,” he believes.

Despite fluctuations in fuel prices linked to the political situation, Kuyun forecasts a positive development regarding the supply of fuel in the Ukrainian market. “As you can see, our consumption is declining, and fuel supplies are stable. Therefore, I think it is unlikely that we will talk about a deficit. We have imported enough fuel. Accordingly, I do not foresee any problems,” he concluded.

It is worth noting that the Antimonopoly Committee of Ukraine is conducting an analysis of pricing behavior in the fuel market and is discussing this issue with gas station operators. This indicates that regulators are actively monitoring the situation in the market and are prepared to take measures to ensure price stability.