Transition to market energy prices backed by Naftogaz, but not until after winter season

While recognizing the need to transition Ukraine's energy market to more transparent pricing over time, Oleksiy Chernyshov, Chairman of the state oil and gas company Naftogaz, has advised that any shift to market-based tariffs be implemented after the winter season, he said in an interview with Ukrinform news agency.

"My personal opinion is that the sooner we do it, the better. We still have to get through this winter under regulated tariffs, the moratorium that is in place. After that, we have to return to this conversation. Of course, we have to protect the public, to protect the cities, so it is too early to talk about it now. But with conditional stabilization of socio-economic life, we should carry out this reform immediately," he said.

In 2022, the Verkhovna Rada supported the government's bill on a moratorium on raising tariffs for heating, hot water and gas for the duration of the war and six months after its end. This decision did not apply to electricity and cold water.

From July 1, 2023, it was planned to increase tariffs for centralized water supply and drainage by an average of 32%, but after the intervention of President Volodymyr Zelenskyy, the regulator walked back on its decision.

The National Bank believes that the moratorium on raising tariffs for heating, hot water and gas established by the Ukrainian parliament will remain until 2025. Then they will have to be increased, and this will have a significant impact on inflation.