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Why petrol and diesel prices are rising in Ukraine?

Author : Serhiy Kuiun

Source : 112 Ukraine

Retail prices of automobile fuels have reached highs across the country
16:00, 3 March 2021

Open source

Why have gas station prices increased? (spoiler: they will grow up even more).Causes
1. Since October, the price of oil in the world has grown from $ 37 to $ 67 per barrel.

  1. The European quotation for A-95 gasoline (purchase price) increased by USD 261 / t, diesel - USD 224 / t.
  2. Wholesale prices in Ukraine during this period increased: by USD 277 / t (with VAT), diesel fuel – 249 USD / t.
  3. Prices for filling stations have added 0,15 USD / l for four months, respectively, for gasoline and diesel fuel.

Related: Ukrainian drivers feel effects of fuel price rise: What's going to happen next?

Forecasts

The potential for further growth remains. The purchase price of gasoline increased by 1.77 more than the retail price. For a diesel engine, the potential is 1.57 UAH (0,06 USD) / l. And this is subject to stable oil prices.

Many people ask why oil prices have risen. Today everyone is just trying to explain it, but no one predicted it. Suffice it to say that the current USD 67 per barrel is higher than it was before Covid in January-February 2020. I think the answer is the same as about the cost of Bitcoin and Tesla. But whatever the answer, one thing is clear: we and all other energy importers are forced to duplicate this dynamic.

Related: No cheap gas in 2021: Why Ukraine cannot increase blue fuel production?

Why did the prices at gas stations soar in February? Growth was uneven and delayed. We were expecting a weekly pickup from mid-December. The largest player in the market, the Privat Group, raised prices for the first time since the beginning of November only on January 27, although oil by that time had already grown by one and a half times. A lot was predetermined by the disastrous January: first the holidays, then the lockdown, then the frost. Consumption is minimal, and contracts require traders to fully redeem volumes from suppliers; as a result, part of the resource at the old prices passed to February. In addition, the factor of “stepping on” is very strong, there is a huge volume of tax-free falsification on the market, which makes it possible to ignore market fluctuations for legal fuel at all. But by the end of the month, the safety margin ran out for everyone. And, as we can see, it is not over yet. The snow has melted, consumption is reviving, the reaction to global trends will become more operational.

Related: Energoatom company ready to refuse from transportation of wasted nuclear fuel to Russia

 

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