Mr. Taras Tkachuk, expert at DiXi Group think tank, suggested his comments for the Ukrainian Energy.
“According to 2015 data provided by the State Statistics Service, Belarus is the biggest importer of oil and oil products in Ukraine — 44%, followed by Europe — 34% and Russia — 18%. Of course, giving up 18% import will cause a trouble for Russian filling stations and operators importing Russian products in the first place”, Mr. Tkachuk said.
The expert is sure that the rapid reduction of supply will cause a temporary deficit in the market, and almost all operators will most probably take advantage of that and increase their prices for fuel. Loss of Russian import is advantageous for domestic producers in the first place because it will reduce competition, and for Belarusian importers of fuel that is mostly processed from Russian oil.
“Therefore, Russia is going to compensate loss of the Ukrainian fuel market with increasing export of oil to Belarus. So we’ll still import Russian resources, only indirectly. For the end consumer, it will mean higher price for the available petrols (except for the premium segment which is imported from Europe) and temporary deficit of supply.
This is also a good chance for Azerbaijani exporters to increase their share in the Ukrainian fuel market. For the state, reduction of supply of oil products before the sowing season seems to be a rather weird decision. In any case, we hope that the government has a clear replacement plan in place and made all necessary preparations to prevent deficit in the market and sharp increase in prices”, Mr. Tkachuk concluded.
