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Automobile fuel is becoming more expensive. What prices to expect?

Fuel

The Verkhovna Rada adopted draft law No. 11256-2, the NaftoRynok analytical agency reports . This document envisages a gradual increase in the excise duty on the main types of motor fuel.

Already from September 1, the excise tax on propane-butane mixture will increase from 52 to 148 euros per 1,000 liters, and in 2027 (after several intermediate increases) the amount of this tax will be 250 euros/1,000 liters.

Also, from the first month of autumn, the tax burden will increase by:

  • Gasoline + UAH 1.58/l
  • Diesel fuel + UAH 2.07/l
  • Liquefied gas + UAH 5.22/l

In the conditions of the actively growing foreign exchange rate, since the beginning of June, "NaftoRynok" notes, a linear increase in prices at most gas stations is expected after the increase in fuel excise rates. A number of large players in the market will compensate for the increase in the cost of fuel by reducing the offers of bonus incentive systems for customers, which in certain networks exceed 10% of the price list value.

How will average gas station prices change?

(current average price + added excise duty = potential new price (excluding exchange rate changes)):

  • Gasoline A-95: 56.68+1.58 = 58.26 UAH/l
  • Diesel fuel: 52.29+2.07 = 54.36 UAH/l
  • Liquefied gas: 26.65+5.22 = 31.87 UAH/l

At the same time, as analysts note, draft law No. 11256-2 on the approximation of the legislation of Ukraine to the legislation of the European Union in terms of excise tax does not at all take into account the recommendations of the Council Directive 2003/96/EU regarding the reduced tax burden for such preferential categories of consumption as agricultural, forestry, horticultural, fishing enterprises and farms, stationary engines and construction equipment, vehicles intended for use outside the carriageway of public roads.

For example, the recommended reduced minimum rate for diesel fuel according to Council Directive 2003/96/EC for the specified categories of consumers is 21 euros per 1000 l, equal to the minimum 330 euros per 1000 l for diesel fuel for motor vehicles.

Propane-butane (LPG) for household use is recommended not to be subject to excise duty at all. The recommended rate for liquefied gas for certain categories of consumers is 41 euros per 1,000 kg (up to 22 euros per 1,000 l at a density of 535 kg/m3), compared to 125 euros per 1,000 kg for autogas (up to 67 euros per 1,000 l).

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