The State Tax Service and the Ukrainian Oil and Gas Association Discuss Measures to Combat the Illegal Fuel Market

On 12 March, representatives of the Ukrainian Oil and Gas Association (UOGA) met with the Head of the State Tax Service of Ukraine (STS), Ruslan Kravchenko. During the meeting, the parties discussed a range of issues necessary for the legalisation of the fuel market, as well as the measures that the STS is already implementing in cooperation with law enforcement agencies to combat illegal fuel production, particularly at mini-refineries.

During the discussion, The Head of STS Mr. Ruslan Kravchenko noted that in the first two months of this year alone, the State Tax Service, in collaboration with law enforcement, conducted 690 inspections, resulting in the revocation of 59 licences, with total financial penalties amounting to UAH 11 million.

President of the Ukrainian Oil and Gas Association, Mr. Yaroslav Starovoytenko, stated:
“According to expert estimates, the shadow fuel market accounts for approximately 16% of the total sector. Currently, the illegal market consists of three main segments: mini-refineries that produce ‘fuel’ which does not even remotely meet standard quality requirements and is sold without tax payments; illegal petrol stations operating without the necessary permits and failing to issue fiscal receipts; and tax fraud schemes, including VAT evasion, artificial profit understatement, and off-the-books payrolls. This illegal activity results in multi-billion losses to the state budget every year, while also giving the shadow market an unfair advantage over legitimate businesses.”

Mr. Kravchenko summarised:
“Illegal petrol stations, underground fuel production, receipt manipulations, and cash-only sales are not just a problem for the state. They also harm legitimate market players who operate transparently. This is about fair competition and equal conditions for all. My position is clear: all market participants must operate within the law—without schemes or tax evasion. This applies to everyone, regardless of business size.”

Transparency and legal compliance in the activities of all market participants remain key principles upheld by UOGA. The Ukrainian Oil and Gas Association supports the measures taken by the State Tax Service aimed at eliminating the shadow fuel market.