The current price increase is a reaction to panic.
Fuel prices in Ukraine have sharply increased. Experts' forecasts have caused panic among drivers, leading to queues at many gas stations. The Antimonopoly Committee stated that Ukrainian gas stations must explain the reasons for the price hike within three days.
70 hryvnias 99 kopecks or $1.6 per liter of 95-octane gasoline at one of the most popular gas stations in Ukraine – the sharp rise in fuel prices occurred against the backdrop of news about strikes in Iran and Iranian attacks on neighboring countries in the Middle East. Some market analysts predict further increases of another half a dollar.
At gas stations, drivers sadly watch the meter that counts liters and hryvnias and prepare to change their plans. "I will drive less," comments one of them. Videos of queues at gas stations have started to appear online.
"We need to have some reserves – a month or two, which would allow us to adapt to this. Not to raise prices sharply," one driver expresses outrage. "I think this is unfair. If you look at reviews, at the analysis of European markets, considering that we are in a state of war in the country, prices should be kept down, but they are rising here."
And this is a popular opinion in Ukraine. The head of the financial committee of the Verkhovna Rada, Danilo Getmantsev, urged participants in the fuel market not to take advantage of panic to make excessive profits and threatened with the Antimonopoly Committee.
Oleg Penzen, an expert from the Economic Discussion Club, points to the excessively rapid rise in fuel prices at gas stations: "There is a time lag between the increase in oil prices and the increase in prices for petroleum products made from that oil. This is about two weeks. Yesterday, we started a war in Iran – and within two hours, prices at all gas stations went up by two – four hryvnias per liter. I have a question: guys, are you colluding?"
Some experts counter that the current price increase is a reaction to panic. No one expected such a rush at gas stations. Sources say that the current price is already final, citing examples from other countries: in Germany and the Netherlands, the price for a liter of 95-octane gasoline has exceeded two euros.
"Companies with stable operations have some fuel reserves. For example, for two weeks. Today, they see that they have fuel for two days at the current increased sales rate. Accordingly, they need to urgently purchase fuel today to avoid stopping operations. And they need to buy at the $1100 per ton that is currently available. This factor is already starting to influence. Although they say: well, there are reserves. Yes, there are reserves, but they will dwindle, and this pushes them to search for new fuel," explains the pricing mechanism head of the A-95 Consulting Group, Sergey Kuyun.
Experts find it difficult to predict how fuel prices will change further, but note that even the current price increase will impact the Ukrainian economy. Since many energy facilities in the country have been destroyed by Russian strikes, fuel for generators is very important and constantly needed for the survival of the country.
"If earlier we expected an average price for oil of about 65 hryvnias, now Dragon Capital's forecast is about 80. And this is just the beginning, and it can change," says investment banker Sergey Fursa. "We will definitely see an increase in gasoline prices compared to what we expected before. This will also affect the prices of other goods. We expect inflation to accelerate by 0.6%."
All Ukrainian experts agree on one point: there will be no fuel shortage. There is enough fuel in the market; the only question is the price.
