Fuel prices at Ukrainian filling stations are slowly going down. Experts say — all thanks to the abolition of the excise tax. But there are other reasons as well.
Motor fuel began to rise in price rapidly from the first day of Russia's full-scale invasion of Ukraine, and by mid-March, the price of gasoline in Ukraine exceeded 40 UAH/l. The state reacted — the parliament abolished the excise tax and reduced the VAT from 20% to 7%. The law came into force on March 18, at the same time fuel prices dropped sharply, reports the Chronicle.info with reference to Focus.
At the moment, Avias sells the cheapest gasoline A-95 in the Kiev region at 33 UAH/l; WOG and OKKO sell the same fuel at UAH 33.52, while at Socar gas stations the price is UAH 39.97/l.
The price of diesel fuel varies between UAH 35-39.97/l.
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What affected the prices of diesel fuel and gasoline. Benefits and concessions in favor of the fuel market
Experts say that the authorities' decisions to reduce taxes and simplify customs procedures «calmed» fuel prices.
«The increase in the logistics component in the methodology for determining recommended prices also contributed to the stabilization of the market. Because the logistics component has grown due to the blocking of seaports and the refusal to supply Russian and Belarusian fuel», — says Gennady Ryabtsev, Director of Special Projects of the Science and Technology Center «Psyche».
In addition, the authorities weakened the eco-requirements for fuel. And that's not all.
«Another positive thing is that we have made it easier for fuel tanker drivers to cross the border. After all, now those liable for military service cannot leave the territory of Ukraine, and the vast majority of drivers of fuel trucks are liable for military service. It was a problem, it was solved», says Ryabtsev.
All these measures had a positive impact on the fuel market in Ukraine during the war.
«If this had not been done, today the price would be 50 UAH/l. And since taxes were removed, gasoline costs UAH 34, diesel fuel UAH 37. Of course it worked. But in fact, it worked at the expense of the sellers, because they agreed to sell the available fuel with an excise tax on the basis that they created for fuel without an excise tax. This is a zero sale at best. In general, the situation is such that there has been no talk of business for a long time», — says Sergey Kuyun, director of «A-95 Consulting Group».
Fly in the ointment or justice? Prices for premium fuel were limited
Last weekend, the Cabinet of Ministers limited prices for premium fuel.
«80% of fuel, mainly gasoline, as the most scarce brand, is sold at regulated prices. But due to shortages, sellers are often forced to limit the sale of 20-30 liters per person. This allows you to fill the maximum number of consumers», — says Sergey Kuyun.
The expert clarifies: if the buyer needs large volumes of fuel to create a reserve, you can additionally purchase premium brand gasoline, the sale of which is not standardized.
«The main volume is now negative or zero profitability. And the sale of these premium brands made it possible to even out the situation, slightly increase profits to cover significantly increased costs. There is no tragedy in these 5%, but this will definitely not improve the condition of suppliers, whose task is simply to survive», Sergey Kuyun is sure.
Gennady Ryabtsev has a different opinion. He says that now the concept of «premium fuel» — This is an invention of business entities. Until 2019, this was social fuel that met Euro3 eco-standards, then Euro4, and premium fuel – Euro5 standards. Recently (before the easing of eco-standards during the war) in Ukraine, all fuel had to comply with Euro5 standards.
«For a long period, the government ignored the fact that consumers were being deceived. Since the increase in environmental and operational characteristics of premium fuel grades did not correspond to the markup per liter of UAH 5 or more. Now the government has paid attention to this and has set marginal markups», said Ryabtsev.
Less volumes, more support. What will help the Ukrainian fuel market
Gennadiy Ryabtsev believes that due to the hostilities, the fuel market in Ukraine needs new approaches.
«It is necessary to disperse fuel reserves across the territory of Ukraine and abandon previous approaches that assumed the concentration of large volumes of fuel at oil depots. Now it is necessary to provide consumers with fuel in a targeted manner, without prior accumulation of resources« , — insists Ryabtsev.
Sergey Kuyun also talks about the obvious risks for companies that continue to supply fuel to Ukraine during the war.
«I believe that the state should think about how to reduce these risks for companies, to take on some of these risks. It is possible to introduce insurance or provide other guarantees so that companies can continue to fulfill their main function — to fill the market with fuel», Kuyun suggests.
Recall that the government introduced state regulation of fuel prices on May 14, 2021. Since then, NAK & # 171; Naftogaz & # 187; calculated the recommended fuel prices, and the Ministry of Economy published them. The exception was the so-called premium brands of fuel.