A widespread increase in fuel prices has begun at Ukrainian filling stations, which, according to an assessment by Serhiy Kuyun, Director of the A-95 Consulting Group (available here), will continue in the near future. The primary drivers are rising global oil prices and a shortage of refined products on the European market, as reported by Dengi.ua.
Why Gasoline and Diesel Prices Have Begun to Rise
According to the expert, global oil prices began to rise as early as July 7, but Ukrainian filling stations were able to keep retail prices stable for about two weeks thanks to existing stockpiles.
Serhiy Kuyun explained that the current price increase is linked to several factors at once. The first is the latest escalation of tensions surrounding Iran and new risks related to the Strait of Hormuz. Against this backdrop, oil prices rose from approximately $72 to $90 per barrel, while the price of diesel fuel on the global market increased from $875 to $1,200 per metric ton.
The second reason is a shortage of refined products in Europe. Oil supplies to European refineries have declined; Russia has halted diesel exports and, at the same time, has begun actively purchasing gasoline on the global market, exacerbating the shortage.
Ukraine has Already Faced a Similar Situation
The expert noted that the current situation resembles the events of March, when Ukrainian companies experienced serious difficulties in purchasing diesel fuel.
As an example, he cited the case of a tanker that was heading to the Romanian port of Constanța with a shipment of approximately 100,000 metric tons of Middle Eastern diesel. En route, the vessel changed course because another buyer offered a higher price, and all previously placed orders were canceled.
What Prices Might Be
According to Serhiy Kuyun’s calculations, if current wholesale prices remain unchanged, the cost of diesel fuel at Ukrainian filling stations could rise to at least 86 UAH per liter, up from the current average of about 79 UAH.
The price of A-95 gasoline, he estimates, could reach at least 83 UAH per liter, whereas on the morning of the publication date, the average price was about 77 UAH per liter.
“Some adjustments may occur as events unfold due to further fluctuations in the global market, but most likely only upward. There are no signs of a de-escalation in the Middle East yet. And this phase of the crisis may be more severe than the one in the spring, since the next two months mark the peak of seasonal consumption, and global reserves of crude oil and petroleum products are depleted and have not yet had time to recover,” noted Serhiy Kuyun.
According to the expert, if the current situation on the global market persists, Ukrainian motorists should prepare for further increases in fuel prices in the coming weeks.
