Gasoline at 100 hryvnias - energy expert explains whether Ukraine is really threatened by a fuel crisis
Kyiv • UNN
Energy expert Stanislav Ignatiev stated that the current situation with fuel is not a systemic shortage, but logistical difficulties due to Russian attacks. He considers it unlikely that the price of gasoline will rise to 100 hryvnias per liter, as this would require a simultaneous combination of several crisis factors.
After a series of Russian strikes on Ukraine's fuel infrastructure, statements about a possible gasoline shortage and a sharp rise in prices are increasingly being heard. Is the situation really that critical, should we expect fuel at 100 UAH per liter, what risks exist for the economy, and what needs to be done right now to avoid a large-scale fuel crisis, energy expert, professor at Poltava Polytechnic, Stanislav Ignatiev, told UNN in an exclusive interview.
The current situation is not yet a gasoline shortage
After the latest Russian attacks on fuel infrastructure in Ukraine, reports emerged of disruptions in gasoline supply in some regions. At the same time, the expert urges not to rush to conclusions and emphasizes: for now, we are not talking about a classic fuel shortage, but primarily about logistical difficulties.
I would not yet call the current situation a classic systemic gasoline shortage. We are primarily observing disruptions in supply logistics chains and a temporary reduction in resource availability in certain regions due to targeted Russian attacks. The enemy understands well that fuel is one of the key elements for the functioning of the economy, the transport system, the agricultural sector, military logistics, and backup energy supply. That is why strikes on oil depots, transport hubs, railway infrastructure, and storage facilities are part of the strategy of economic exhaustion of Ukraine
According to him, since the start of the full-scale war, the Ukrainian fuel market has virtually completely changed its operating model. While previously a significant portion of gasoline came from Russia and Belarus, now over 95% of imports are provided by European Union countries.
This has significantly increased the system's resilience, as we no longer depend on one or two supply routes. But at the same time, logistics have become critically important. Even if there is enough gasoline in Europe, any damage to transport infrastructure or fuel depots can temporarily create a local shortage. The problem today is not the absence of gasoline as a commodity, but the ability to quickly deliver it to Ukrainian gas stations
He notes that in the absence of new large-scale attacks, the market balance can be restored quite quickly.
If the intensity of Russian strikes decreases in the near future and the logistics infrastructure does not suffer new serious damage, the situation could stabilize within a few weeks. Our operators already have extensive experience in quickly changing supply routes and promptly redistributing resources between regions. But if strikes on logistics hubs become systematic, then problems could drag on for several months. It will not be so much about a complete absence of gasoline, but about uneven distribution of the resource and constant pressure on prices
Is gasoline at 100 hryvnias per liter possible
In recent days, forecasts about a possible increase in the cost of gasoline to 100 UAH per liter have been heard more and more often. However, the expert calls such a development unlikely.
A price of 100 hryvnias per liter is not the baseline scenario today. This is rather an extreme development option, which is possible only with the simultaneous overlap of several very serious negative factors
According to Ignatiev, such a jump requires the simultaneous combination of several crisis processes.
First, there must be large-scale destruction of fuel logistics, which will force operators to use much longer and more expensive delivery routes. Second, world oil prices must rise to over 90–100 dollars per barrel, and the European market must experience a gasoline shortage. Third, there must be a significant devaluation of the hryvnia, since Ukraine imports almost all of its gasoline. And finally, the fourth factor is panic demand from the population. We already saw in 2022 that panic buying alone can very quickly heat up the market
At the same time, he emphasizes that the simultaneous realization of all these factors seems unlikely.
If at least one of these factors does not materialize – the main import routes remain open, there is no sharp jump in global oil prices, or the population does not start mass-buying fuel – the scenario with a price of 100 hryvnias per liter will most likely not happen. The Ukrainian market has repeatedly proven that it is capable of adapting even to very difficult conditions
What needs to be done right now to avoid a fuel crisis
According to the expert, today the key task of the state is to ensure the most uninterrupted operation of the entire petroleum product import system.
First of all, it is necessary to minimize the time it takes for fuel cargoes to pass through the western border. Every extra day of idle time for a fuel truck or railway tanker increases importers' costs and reduces the available resource on the domestic market. It is equally important to diversify logistics as much as possible – to evenly use routes through Poland, Romania, Slovakia, Hungary and Moldova in order to avoid overloading individual crossings. The Danube logistics and the development of transshipment through river ports also have great potential
According to him, businesses themselves must also actively prepare for possible risks.
Operators should increase insurance stocks of gasoline, enter into long-term contracts with European suppliers, use several independent delivery routes and diversify the geography of purchases. In addition, today it is extremely important to invest in the physical protection of fuel infrastructure – tank farms, oil depots, logistics centers, firefighting equipment and anti-drone systems
The expert paid special attention to the need to create strategic fuel reserves. He noted that most European Union countries maintain petroleum product reserves for approximately 90 days of consumption. For Ukraine, which lives under conditions of full-scale war, the formation of such strategic reserves should become one of the priorities of state policy, and this will make it much easier to get through any crisis periods"
Alternative routes exist, but they are not unlimited
The expert notes that today Ukraine has significantly more opportunities for fuel imports than at the beginning of the full-scale war.
The market has almost completely integrated into the European supply system. Fuel comes from Poland, Lithuania, Romania, Germany, the Netherlands, Greece and other EU countries. The problem today is not the lack of supply sources, but the ability to use them quickly
At the same time, the expert warns that logistics has its physical limits.
The capacity of road checkpoints, railway crossings and Danube ports is not unlimited. If several logistics routes are damaged simultaneously or import volumes increase significantly, the system could operate practically at the limit of its capabilities. That is why it is critically important not to concentrate imports on just one or two routes. The wider the geography of supplies, the more resilient the Ukrainian fuel market will remain
The main danger is not the lack of gasoline, but a new wave of inflation
According to the expert, even if a physical fuel shortage does not occur, a sharp rise in gasoline prices could be a serious blow to the economy.
Fuel is one of the fundamental resources of the modern economy. If its cost rises sharply, it is almost immediately reflected in all sectors – from agriculture and industry to transport, construction, trade and public utilities. More expensive fuel means more expensive logistics, higher production costs, operation of agricultural machinery, public transport, emergency services and even backup diesel generators. That is why the biggest risk today is not the physical absence of gasoline, but a possible price shock, which could become one of the main drivers of inflation
At the same time, he does not rule out that in the event of a sharp deterioration of the situation, individual gas station networks may resort to temporary restrictions.
If the situation significantly worsens, individual operators may temporarily introduce limits on the sale of gasoline per person. Such a mechanism was already used in 2022 and allowed for a more even distribution of resources among consumers and curbing panic demand. But at the moment there are no grounds to talk about the need for nationwide rationing of fuel sales