Petrol and diesel prices are rising much faster than overall inflation. The increase is driven by higher taxes, turmoil on the global oil market, shortages of refined fuel in Europe, currency fluctuations and wartime risks
At the beginning of 2026, one litre of A-95 petrol in Ukraine cost an average of UAH 58.26, diesel fuel cost UAH 58.30, and liquefied petroleum gas cost UAH 37.63.
By the end of July, the average price of A-95 petrol had exceeded UAH 80 per litre, diesel had risen above UAH 85, and LPG had reached more than UAH 41.
In less than seven months, A-95 petrol increased in price by approximately 37%, diesel by more than 46%, and LPG by almost 10%.
The situation with diesel is particularly revealing. It has become more expensive than petrol, although it traditionally cost approximately the same or even less. This suggests that the Ukrainian market is facing not only higher crude oil prices but also a shortage of refined petroleum products.
Taxes provided the first push
The first wave of price increases began at the start of the year. On 1 January 2026, Ukraine moved to the next stage of raising fuel excise duties.
The excise duty on petrol increased from EUR 271.70 to EUR 300.80 per 1,000 litres. The rate for diesel rose from EUR 215.70 to EUR 253.80, while the rate for LPG increased from EUR 173 to EUR 198.
This increase is part of legislation aimed at gradually bringing Ukraine’s fuel taxation system closer to European Union rules.
The excise duty alone cannot explain a rise of UAH 20–27 per litre. However, it created a new minimum cost level. Even when global oil prices decline, the tax component of the retail price does not return to its previous level.
In addition, the excise duty is denominated in euros. Its value in hryvnias therefore depends not only on the tax rate but also on the exchange rate.
The main blow came from the global market
The most powerful factor was the crisis on the global oil market in the spring of 2026.
In January and February, the price of Brent crude rose from approximately USD 61 to USD 72 per barrel amid escalating tensions in the Middle East.
After traffic through the Strait of Hormuz fell sharply, prices rose even further. The average Brent price reached approximately USD 103 per barrel in March and USD 117 in April, exceeding USD 130 on some days.
The situation was described as one of the largest disruptions to oil supplies in the history of the global market. Global oil supply fell by approximately 10 million barrels per day.
Prices increased not only for crude oil but also for diesel, aviation fuel, petrol and LPG.
Ukraine cannot isolate itself from such a shock. Following the destruction and shutdown of a significant part of its domestic refining capacity, the country has become critically dependent on imports of petrol, diesel and gas.
Changes in global oil and refined-product prices are therefore quickly transferred to the Ukrainian market.
Why diesel rose more sharply than petrol
The price of crude oil is only one component of the price displayed at filling stations. Oil must first be refined into petrol or diesel, transported to European terminals and then delivered to Ukraine.
During the summer, global crude oil prices began to fall from their spring peaks. However, refined fuel remained expensive.
The reasons included difficulties restoring operations at Middle Eastern export facilities, lower refining volumes in Russia, maintenance at European refineries and limited production in Asia.
The diesel market proved particularly vulnerable. Diesel is required by freight transport, agriculture, industry, the military and generators.
Demand for diesel therefore remains high even when household consumption weakens.
A shortage of refined fuel explains why petrol station prices may remain high even when crude oil is already becoming cheaper on the global market.
The exchange rate intensified the increase
Ukrainian companies purchase petroleum products in dollars and euros but sell them in hryvnias. Any weakening of the national currency therefore automatically increases the cost of imported fuel.
At the beginning of the year, prices were simultaneously affected by more expensive European petroleum products and the depreciation of the hryvnia. In the spring, these factors were compounded by a sharp increase in oil prices due to the crisis in the Middle East.
Excise duties are calculated in euros, while much of the international fuel trade is linked to the US dollar. The Ukrainian market therefore depends on two foreign currencies at once.
Even when global prices remain stable, a weaker hryvnia means more expensive petrol and diesel for Ukrainian consumers.
The war has made logistics more expensive
Before the full-scale war, Ukraine received a significant share of its fuel through seaports, pipelines and neighbouring countries.
Suppliers now have to use more complicated routes, including railways, tanker trucks, Danube ports and European transshipment facilities.
Disruptions to diesel supplies from Slovakia and Hungary created additional pressure. Traders were able to redirect imports through other routes, preventing a prolonged physical shortage at filling stations.
However, alternative supplies proved more expensive.
The final price also includes cargo insurance, the risk of damage to infrastructure, the cost of maintaining reserves, fuel storage and the energy required to operate depots and filling stations.
Each of these components may appear relatively small on its own. Together, however, they create a permanent wartime premium on every litre of fuel.
Is E10 petrol responsible?
In July, Ukraine began a broader transition to E10 petrol, which contains a higher proportion of bioethanol.
Because the change coincided with another jump in prices, motorists may have assumed that the new fuel composition was responsible.
However, this is only a secondary factor. The addition of bioethanol may increase production costs by approximately 50–70 kopiykas per litre.
That is less than 1% of the retail price. Global prices, exchange rates, taxes and logistics remain the decisive factors.
E10 petrol may have slightly increased suppliers’ costs, but it cannot explain an increase of more than UAH 20 per litre since the beginning of the year.
Why filling stations raise prices with a delay
Prices at Ukrainian filling stations do not change at the same time as global market quotations.
Fuel retailers sell products that were purchased earlier. There is therefore usually a delay between changes in wholesale costs and the appearance of new prices at filling stations.
For a certain period, retailers can restrain price increases by using existing stocks and fuel purchased at lower prices. Once new and more expensive deliveries arrive, retail prices begin to rise.
The same mechanism works in the opposite direction. When oil becomes cheaper, filling-station prices do not fall immediately.
Retailers must first sell their more expensive stocks and wait for cheaper deliveries.
Expensive fuel is paid for by more than motorists
Higher petrol prices are most visible at filling stations, but the economic consequences are much broader.
Diesel costs are included in the price of food deliveries, agricultural machinery, construction, passenger transport, industrial production and backup electricity generation.
As business costs increase, transport services, vehicle repairs, food and other goods gradually become more expensive.
Fuel effectively acts as a hidden tax on the entire economy. Even people who do not own a car pay for it through higher delivery costs, fares, food prices and service charges.
Can prices return to their level at the beginning of the year?
A return to UAH 58–60 per litre for petrol and diesel appears unlikely in the near future.
Even if global oil prices continue to decline, part of the increase has already become structural. Excise duties, import costs, logistics expenses, insurance and storage costs have all risen.
In addition, shortages of certain refined petroleum products remain on the global market. A decline in crude oil prices therefore does not always immediately result in cheaper petrol or diesel.
Some price reduction is possible if the hryvnia strengthens, European refineries operate steadily, fuel reserves increase and no new international crisis occurs.
However, lower oil prices alone will not be enough to restore January’s retail prices.
Conclusion
There is no single reason for the increase in Ukrainian fuel prices in 2026.
Higher excise duties provided the initial push. The weakening of the hryvnia intensified the pressure, while the global oil-market crisis transformed gradual growth into a price shock.
A shortage of refined products, Ukraine’s dependence on imports and complicated wartime logistics prevented prices from falling quickly, even after oil quotations retreated from their peak levels.
Ukraine imports not only petrol and diesel but also all the external risks associated with them.
As long as the country remains dependent on foreign refining capacity and long supply routes, any international crisis, currency fluctuation or disruption at European refineries will quickly appear on the price boards of Ukrainian filling stations.
