Standing in lines for gasoline and diesel can take up to several hours. And that’s if you’re lucky to be somewhere where fuel is available, like in Lviv or Ivano-Frankivsk Regions. In many other regions there is no fuel at all. My own trip to Kyiv was delayed for several days. And I understand that I was fortunate: refueling just a few times, a few hours of queuing and I even managed to fill 15 liters in a jerrycan. Most gas stations are limiting sales to 10 litres per vehicle!
By the way, jerrycans are already in short supply in Lviv Region. My girlfriend, Iuliia Mendel, had to find one through an online store and buy it in a warehouse.
The reasons for the situation are clear: 1. Imports of fuel from Belarus stopped once the war began. 2. Russia’s naval blockade has closed Ukrainian ports, further limiting the sources of supply. 3. Then the Russians used missiles to damage the Kremenchuk oil refinery in Poltava Region, and are now damaging the railway logistics system.
Support from friendly European countries cannot be provided quickly. Nobody prepared their oil refinery and transport industries for such a situation. Moreover, the energy crisis around the world is dictating rising prices. If they sell fuel abroad at a price equivalent to 45-50 hryvnias, Ukrainian fuel market operators cannot buy it with a price limit of 37 hryvnias in Ukraine.
Therefore, there is either a high price or shortage of fuel. There’s no other option, at least for now.
Ukraine currently consumes about 5,000 tons of gasoline and up to 15,000 tons of diesel per day on average, according to very rough estimates.
In total, according to the Ministry of Economy, 92,500 tons of gasoline and 81,400 tons of diesel were available on the market from private and state (available to the civilian sector) reserves – at least, if the state sells fuel from its reserves into the market, as the Ministry of Economy has promised. Overall, that is about 20 days of gasoline consumption and 5-6 days of diesel consumption.
There are two solutions to the problem, both of which need to be implemented in parallel: 1. Keep the level of regulated prices above market prices – and constantly monitor it. This will protect consumers from speculative prices, while freeing the hands of private market operators who were prevented by price regulation from providing the country with fuel in a timely manner. 2. Resolve a number of logistical problems that are preventing the rapid delivery of the required amount of fuel across the Western border.
Overly long offloading times in Romanian ports, problems with deliveries and trans-shipment from Poland, shortage of necessary transport cars, limited opportunities of delivery through Lithuania, etc.
Both the state and business sector need to work 24/7 on all of this, so that Ukrainians can get behind the wheels of their cars as soon as possible.
The views expressed in this opinion piece are the author’s and not necessarily those of the Kyiv Post.
