DESPITE FULL IMPORT DEPENDENCE, FUEL IN UKRAINE REMAINS CHEAPER THAN IN THE EU
The Ukrainian Oil and Gas Association emphasizes that, despite the current upward pressure on prices, the domestic fuel market remains stable, with no indications of a potential shortage.
The primary driver behind rising fuel prices is the European market, to which Ukraine is now directly linked. Following the full-scale destruction of its oil refining infrastructure during the war, Ukraine has effectively transitioned to importing finished petroleum products. Petrol and diesel consumed domestically are sourced from EU countries, meaning that Ukrainian prices now move in close alignment with European market dynamics.
In practical terms, this means that crude oil prices are no longer the decisive factor for Ukraine. Instead, the key benchmark is the cost of refined petroleum products in Europe.
In recent weeks, fuel prices have been influenced by a combination of external pressures. Among the key factors is heightened geopolitical tension around the Strait of Hormuz—one of the world’s most critical routes for oil transportation—where any instability directly affects global supply expectations. At the same time, additional pressure is coming from increased demand within the EU. European countries are actively rebuilding reserves, the agricultural season is driving up consumption, and domestic needs are, as expected, taking priority over exports.
At the same time, several additional factors continue to exert pressure on prices. Logistics costs have increased, while the exchange rate and tax burden—accounting for approximately 38–42% of the price per litre—remain significant components. Under wartime conditions, these tax revenues are directed toward financing national defence and security. As a result, each new batch of fuel enters the market at a higher cost, which is then reflected in retail prices at filling stations.
Certain international comparisons may indicate a higher rate of price growth in Ukraine. This is explained by the structural characteristics of the market: due to reliance on imports of finished fuel and limited capacity to build reserves, Ukrainian prices respond more rapidly to changes in Europe. At the same time, this concerns the pace of change rather than the absolute price level: in absolute terms, fuel in Ukraine remains cheaper than in most EU countries.
To support consumers, the state has already introduced cashback mechanisms that partially offset fuel expenses and reduce the financial burden on both households and businesses. The government cashback scheme reimburses between 5% and 15% of the fuel cost, depending on its type. As a result, Ukrainians pay 25–40% less than in neighbouring EU countries.
For comparison: in Germany and France, petrol is priced at €2.00–2.05 per litre (approximately UAH 103 per litre), while diesel costs €2.21–2.25 per litre (around UAH 113 per litre). In Poland, petrol ranges between €1.60 and €1.70 per litre (approximately UAH 86 per litre), and diesel between €1.80 and €1.90 per litre (around UAH 96 per litre).
In Ukraine, petrol is priced at approximately UAH 71.7 per litre, and—taking into account the state cashback—around UAH 64.6 per litre. Diesel stands at UAH 84.6 per litre, and UAH 72 per litre with the national cashback applied. Consequently, Ukrainians pay noticeably less than citizens of EU countries.
A further factor is security. Under wartime conditions, Ukraine does not have the capacity to build up fuel reserves in the manner of EU countries. As a result, any fluctuations in the European market are reflected more rapidly within the domestic market.
At the same time, Ukraine’s fuel market remains competitive: dozens of operators are active, prices are determined by market forces, and the state continuously monitors the situation. State-owned companies also play an important role in maintaining supply stability, in particular Ukrnafta.
The key point is that there is no fuel shortage. Ukrainian companies, in cooperation with the government, are working on a daily basis to maintain supply stability and prevent disruptions. At present, deliveries remain steady, filling stations are operating as usual, and the market is sufficiently supplied—even during the sowing season.
The market is functioning. Fuel is available. The supply system remains resilient, even under wartime conditions. Moreover, fuel for Ukrainian consumers remains cheaper than in most European Union countries.
