Fighting fuel shortages at gas stations: gasoline and diesel will rise in price in Ukraine

The maximum sales surcharge for diesel and petrol has been increased by 40%. Such decision adopted by the Cabinet of Ministers of Ukraine to prevent fuel shortages at gas stations.

Thus, the trade markup for diesel fuel was increased from 5 to 7 hryvnias including VAT (by 40%), for motor gasoline - from 4,55 to 6,5 hryvnias (by 42,8%).

Thanks to these changes, at the maximum markup, diesel fuel will cost no more than 40,66 UAH/liter, gasoline - no more than 36,05 UAH/liter.

Recall according to the previous maximum price cap for fuel, diesel should not have cost more than UAH 38,66/l, gasoline - UAH 34,10/l. Branded premium fuels with improved quality indicators are not subject to the maximum trade markup.

At the same time, it is likely that the current decision of the Cabinet of Ministers will not help to completely get rid of the fuel shortage. Prime gas station chain owner Dmitry Leushkin stated that diesel now costs UAH 41 per liter in wholesale, gasoline - UAH 34-35 per liter, and market operators may again not want to sell fuel with a zero or loss-making yield.

On the other hand, gas stations may go for raising fuel prices above those set by the government, as they did earlier in the Privat group.

Vice Prime Minister of Economy Yulia Sviridenko 29 April reportedthat the tangible shortage of fuel at gas stations in certain regions of Ukraine, formed last week, is associated with the destructive strikes of Russian troops over the past three weeks on the fuel infrastructure of Ukraine.

Thus, as a result of shelling, a number of important fuel facilities were destroyed. In particular:

• Kremenchug oil refinery, which was the main fuel producer in Ukraine;
• large tank farms of market operators with significant fuel reserves.

In addition, among the reasons for the shortage and rising prices for fuel, market experts also called the increase in the cost of logistics (now it can be delivered only in small batches, mainly using fuel trucks) and the lack of transport for this.

«Within the next seven days, the deficit will be eliminated, since the operators have contracted volumes in Western Europe, and now we are solving the issue of how to import them to the territory of Ukraine as quickly as possible.”- said Sviridenko.

We also recall that in March the Cabinet of Ministers decided to abolish the excise tax on fuel and reduce VAT from 20% to 7% on it in order to curb price increases.

We previously told on the reasons for the rise in fuel prices in the Ukrainian market and wrote that the inhabitants of Kyiv are asked switch to public transport due to fuel shortage.