KYIV, May 17 – Ukraine’s gasoline chains on Monday resumed selling premium fuel, a day after confusion about over pricing had forced them to shut down following the government’s controversial measures to regulate the sector.

The disruption shows how the government’s poorly thought out and non-market measures can disrupt the markets without hours and may later lead to criticism from international financial institutions.

Ukraine has moved to introduce state regulations in retail gasoline sector in an attempt to stop rapidly growing prices of gasoline and diesel fuel amid looming supply problems.

The government’s order introduced a maximum retail price markup of Hryvnia 5 per one liter of gasoline and a maximum retail price markup of Hryvnia 7 per liter of diesel fuel, the economy ministry said Friday.

The economy ministry explained on Monday the regulation measures do not affect the premium fuels, and the chain can go ahead and use higher markups.

SOCAR and KLO, the two major gas station chains, reported resuming sales of premium fuel to motorists. “The sale of premium fuel has been resumed... The terms of the loyalty program are being set up," SOCAR said in a statement.

But Serhiy Kuyun, director of the A-95 consultancy, said the confusion still remains and the chain may still get retaliatory action from the authorities for selling gasoline and diesel fuel at higher prices.

"The resolution of the Cabinet of Ministers clearly states in the list of regulated fuel grades: A-95 gasoline and diesel fuel. All branded fuels, first of all, are A-95 gasoline and diesel fuel. Therefore, no matter what the Ministry of Economy writes, one can fully justifiably punish [filling stations for selling premium A-95 and diesel fuel]. This is the main reason that not all networks have resumed selling these brands," he wrote on his Facebook page.

He said that some chains do not sell regular gasoline and diesel fuel at all, but only branded one.

"Thus, a network continues selling branded fuel at prices higher than those set by the regulator. It turns out that others can do the same, calling their regular diesel branded or leaving only the branded diesel in the pump. I am sure that something new will be discovered every day," Kuyun said.

Analysts said the state regulations will hurt retail gasoline chains and may cause important transportation and logistics costs, exchange rate fluctuations and other factors. (tl/ez)