KYIV, May 27 – President Volodymyr Zelenskiy has ordered the authorities to focus attention on illegal market of petroleum products in order to increase tax collection and to prevent steep price hikes at the pump, officials said Thursday.

Yulia Svyrydenko, deputy head of the presidential office, said the crackdown on ‘illegal’ gasoline sales may help Ukraine raise additional UAH 20 billion in 2021, and urged traders to cooperate with the government.

Svyrydenko noted that the “priority of the authorities in the near future will be to counter the illegal market of petroleum products, due to which the budget loses up to UAH 20 billion,” a statement issued by the Zelenskiy’s office said. “The President and the government are ready to consider proposals from market players regarding the steps to be taken to rid Ukraine of illegal sellers of petroleum products."

The developments come 10 days after a confusion over the government’s order regulating prices on the gasoline market has created chaos and forced many chains to briefly suspend sale of premium gasoline.

The disruption showed 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 on May 16 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.

Svyrydenko said the government stays in touch with the traders to make sure the price does not increase steeply, and said price fluctuations may have been caused by volatility on the global market.

"During the conversation, the meeting participants noted that the rise in prices at filling stations is due to both the rise in prices for raw materials in world markets and the illegal market of petroleum products within the country, as well as systemic tax evasion by oil refiners. This leads to the fact that companies, that operate in the market transparently, are losing the competition for the consumer to less honest fuel suppliers," the statement said. (tl/ez)