REUTERS
At least 1,500 gas stations and an undefined number of petroleum products warehouses are now operating illegally in Ukraine.
The Ukrainian Oil & Gas Association says losses of the national and local budgets from Ukraine's shadow market of oil products in 2018 are estimated at UAH 10 billion, or US$381.8 million.
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"The volume of fuel sold through illegal filling stations reaches 40,000 tonnes per month. The shadow market, in particular, in the diesel fuel segment, accounts for 20%, while the share of that in the liquefied gas segment is 50%. The estimated losses of the state and local budgets in 2018 stood at about UAH 10 billion," the Association's press service said on June 25.
At least 1,500 gas stations and an undefined number of petroleum products warehouses are currently operating illegally in Ukraine, the report said.
Such volumes of illegal turnover of petroleum products do not exist in any of the neighboring countries, either in Europe or in the CIS.
Having studied the world experience in monitoring fuel turnover, the Association, jointly with market participants, experts from the Finance Ministry and the State Fiscal Service, developed a plan of legislative changes that will significantly reduce the shadow market. The Verkhovna Rada, Ukraine's parliament, approved the changes by passing bill No. 2628 dated November 23, 2018.
"However, at a government meeting on June 19, 2019, Ukrainian Prime Minister Volodymyr Groysman decided to put the brakes on the petroleum products turnover control system reform required for the market just two weeks before the implementation of the draft law and six months after it was passed. As a result, the draft resolution was sent for revision ... This means that the reform, which could lead to a sharp reduction in the shadow fuel market, an increase in tax revenue and an improvement in the quality of fuel for consumers, will fail once again," the press service said.
The Association calls on the country's leaders to prevent the oil and gas market from further sliding into the shadows, reducing the country's budgets revenue and decreasing citizens' safety.