Business Week: Double-digit inflation, $46.7 billion in reserves, boom in millionaires

This week, the Verkhovna Rada ratified the Agreement signed on April 30 between the Government of Ukraine and the Government of the United States on the establishment of the American-Ukrainian Reconstruction Investment Fund.

The European Commission has officially presented a new plan to completely abandon Russian energy resources, while the US and Russia are negotiating a possible resumption of gas supplies to Europe. Meanwhile, Ukraine pumped 44% less gas into underground storage in April than in the same period last year.

The country's reserves reached a new historical high, annual inflation exceeded 15% for the first time in two years, and the number of hryvnia millionaires increased by 60%.

More details about the main events of the week can be found in the LIGA.net business news digest.

Oil price drops below $60 per barrel for first time since 2021

On May 5, the price of oil on the world market fell by more than $2 per barrel due to the OPEC+ decision made over the weekend to accelerate the increase in oil production.

According to Reuters, North Sea Brent crude futures fell 3.6% to $59.08 per barrel, and US WTI crude futures fell 3.9% to $56.00 per barrel.

At the end of 2023, eight OPEC+ member countries, led by Saudi Arabia, agreed to artificially reduce oil production by 2.2 million barrels per day to maintain an acceptable level of prices on the world market. A gradual but fairly rapid lifting of these restrictions began in early April 2025.

The total increase over the three months (April, May and June) will be 960,000 barrels per day. This means that participating countries have already lifted 44% of the initial restrictions.

Ukraine halved gas injection into underground storage facilities in April compared to 2024

In April 2025, Ukraine pumped 258 million cubic meters of natural gas into underground storage facilities, which is 44% less than in the same period in 2024 (460 million cubic meters).

ExPro calculations show that this year's injection season began later – on April 17. On the first day, only 2.1 million cubic meters were injected into the underground storage facility, and by the end of the month the pace increased – on April 30, a maximum of 35 million cubic meters per day was reached.

As of May 1, Ukraine's underground storage facilities held 5.7 billion cubic meters of gas, down 33% from a year earlier. Active reserves are over 960 million cubic meters, and the overall fill rate is 18.4%.

To properly prepare for the heating season, Ukraine must increase gas imports. To repeat last year's figure of 12.92 billion cubic meters as of November 1, another 7.2 billion cubic meters must be pumped in. Part of this will be covered by domestic production, the rest will have to be imported, despite losses in the sector due to shelling in February-March.

Bitcoin unexpectedly rose by more than 3% in a day – to $104,000

Bitcoin unexpectedly rose in price by more than 3% in a day, reaching $102,500, and at its peak exceeded $104,000, which is the highest level since January 31.

The CoinDesk profile publication writes that such a rapid rise in the first cryptocurrency was a shock to the market and caused massive losses among traders who were betting on a price drop. The main reason for the rally was the announcement by US President Donald Trump about a new large-scale trade agreement with the United Kingdom.

The total market capitalization of cryptocurrencies (excluding Bitcoin itself) increased by 10% to $1.14 trillion, the highest since March 6.

Amidst this surge in Bitcoin, nearly $400 million was lost on short positions (traders’ bets on Bitcoin’s price falling). This is the largest amount of liquidations since November last year. Also, $22 million was liquidated in long positions – bets on growth that could not withstand the volatility.

The Verkhovna Rada ratified the subsoil agreement with the US

On May 8, the Verkhovna Rada ratified the Agreement between the Government of Ukraine and the Government of the United States of America on the Establishment of the American-Ukrainian Reconstruction Investment Fund, signed on April 30.

338 people's deputies voted "yes." Not a single deputy among those who took part in the vote abstained or voted against.

Contributions to the fund will be made jointly by the United States and Ukraine. The United States will contribute by providing military assistance to Ukraine or in other ways of its choosing.

Ukraine will contribute to the fund by allocating from the budget part of the revenues received from subsoil use rent payments and issuing licenses for mineral extraction. After the ratification of the agreement on the establishment of the fund, there will be two more agreements: the Limited Partnership Agreement and the Agreement defining the principles of the fund's operation.

These new agreements will be commercial in nature between two legal entities: the US International Development Finance Corporation and the Ukrainian Agency for Support of Public-Private Partnerships.

Ukraine's reserves have increased to $46.7 billion – a new historical high

As of May 1, 2025, Ukraine's international reserves increased to $46.68 billion, a new historical record. The growth for the month was more than $4 billion, or 10.2%. The National Bank explains this rapid increase in reserves by large tranches of financial assistance from international partners.

The government's foreign exchange accounts at the National Bank received $4.86 billion from the European Union within the framework of the Ukraine Facility and the G7 Extraordinary Revenue Acceleration for Ukraine initiative, $1.29 billion from international partners through the World Bank accounts, and $192 million from the placement of foreign exchange government bonds.

Another tranche – a British loan worth $992 million – was not included in Ukraine's international reserves due to its limited purpose. Payments for servicing and repaying the public debt amounted to $517.9 million, and Ukraine paid another $82.1 million to the International Monetary Fund.

In April, net sales of foreign exchange under NBU operations continued to decrease and amounted to $2.2 billion, down 17.1% from the previous month. The revaluation of financial instruments led to an increase in reserves by $742.5 million.

The European Union will officially abandon Russian gas

The European Commission officially presented a new plan called the REPowerEU Roadmap on May 6, which aims to completely abandon energy resources from Russia. The necessary legislative initiatives will be submitted in June.

The European Commission website states that the EU intends to gradually and fairly quickly abandon imports of Russian gas, oil, and nuclear energy, while ensuring stable supplies and prices for energy resources.

The plan includes a ban on new contracts for Russian gas and the termination of existing spot contracts (i.e. contracts that allow for the purchase of gas on a short-term basis at current market prices) by the end of 2025.

A complete cessation of imports of Russian gas – both pipeline and liquefied – should occur by the end of 2027.

Annual inflation in Ukraine exceeded 15% for the first time in two years

Annual inflation rates in Ukraine have accelerated again, according to data from the State Statistics Service. Annual inflation in April was 15.1%, after 14.6% in March.

Compared to March 2025, inflation slowed in April to 0.7% after 1.5% in the previous month.

Prices for poultry, sugar, beef, fish, bread, lard, pasta, vegetables, and soft drinks also increased (up from 0.8% to 3.6%). Eggs, rice, and butter became cheaper in April (down from 0.2% to 2.5%).

The NBU explained in its April inflation report that the upward inflation dynamics are currently due to the residual effects of last year's poor harvests, higher prices for excisable products, as well as the impact of fundamental factors, in particular, from the increase in enterprises' spending on energy resources and labor costs and stable consumer demand. At the same time, the monthly dynamics of inflation, adjusted for seasonality, indicate signs of weakening price pressure.

Ukraine's largest gas company breaks drilling record

JSC "Ukrgazvydobuvannya", part of the Naftogaz Group, set a new quarterly drilling record.

The press service of Naftogaz reported that in the first quarter of 2025, the company's drillers traveled 107,136 m. This is almost twice as much as in the same period last year and exceeds the previous quarterly maximum recorded in the third quarter of 2024 (102,866 m).

Record figures for Ukrgazvydobuvannya were achieved despite enemy shelling, emphasized Roman Chumak, head of the Naftogaz group.

The most productive month was March – 41,229 m of penetration, which is 6,929 m more than the planned figure (34,300 m). Thus, the monthly record set in April 2024 (40,059 m) was also surpassed.

US and Russia discuss how to restore Russian gas supplies to Europe

The United States and Russia are discussing the possibility of resuming Russian gas supplies to Europe, Reuters reports, citing eight sources.

Restoring Russia's role in the European gas market is seen as a possible element of a peace deal with Putin, and US participation in this process could smooth out political resistance in Europe and give the Americans some control over exactly how much Russian gas Europe will receive.

Various options for American participation are being considered: investments in Nord Stream and the Ukrainian gas transportation system, a stake in Gazprom, and the participation of American companies as intermediary buyers.

Gazprom is even considering offering German customers short-term 24-month contracts with significant discounts instead of traditional multi-year agreements.

Russia's share of the European gas market has fallen from 40% to 19% over the past three years, seriously affecting the Russian economy.

The number of Ukrainians with declared income of over UAH 1 million per year increased by 60%

The State Tax Service of Ukraine recorded a significant increase in the number of official millionaires – over 17,000 of them, which is 6,600 more than last year.

According to the State Tax Service, these wealthy Ukrainians declared a total income of UAH 253.6 billion for 2024 and will pay UAH 8.7 billion in taxes to the budget.

One of the residents of Kyiv set a national record by declaring tax liabilities in the amount of 4.6 billion hryvnias.

In total, 170,000 declarations were filed during the declaration campaign, with total income of UAH 326 billion. The largest amounts were declared in Kyiv – UAH 156 billion, Dnipropetrovsk region – almost UAH 30 billion, and Lviv region – UAH 18.2 billion.