No fuel station crisis expected after May 1 bioethanol mandate in Ukraine – OKKO CEO

There will be no disruption at Ukrainian fuel stations after May 1, when a new requirement to blend 5% bioethanol into gasoline with an octane rating below 98 takes effect, assures Vasyl Danyliak, CEO of the OKKO Group.

"There will be no crisis. Initially, we'll import ready-made fuel with bioethanol, and gradually all market operators will implement this blending process themselves," Danyliak told Interfax-Ukraine.

According to him, OKKO has been preparing for this transition for some time by modifying its infrastructure to support on-site blending at fuel depots.

"We've been working on this for a year now, making sure that our fuel depots are equipped to mix and add bioethanol directly into tanker trucks. These will be separate tanks located at the depot, used during the loading process," he explained.

Danyliak also noted that the percentage of bioethanol in gasoline may increase over time.

"Right now, it's 5%, but I believe the mandates will rise. Possibly to 8%, maybe even 10%. In our case, I think going up to 8% makes perfect sense," he said.

At the same time, he pointed out that first-generation bioethanol has limitations on how much can be blended, unlike second-generation bioethanol, which can be added in larger proportions.

"But for now, most of what's being produced is first-generation bioethanol," Danyliak added.

The bioethanol mandate stems from Law No. 3769-IX, passed on June 4, 2024, which requires that all gasoline with an octane rating below 98 contain 5% bioethanol starting May 1, 2025. The only exceptions are fuels designated for the Ministry of Defense, the State Reserve, or for creating minimum strategic reserves of oil and petroleum products.

In a separate interview with Energy Reform, Oleksandr Dubinin, owner and CEO of the Parallel Group (which operates the Parallel filling station chain), also said the new mandate would not significantly impact fuel prices. However, he noted that while the initiative is presented as a measure to support domestic agriculture, most blended fuel will be imported as a finished product from European refineries, since Ukraine's infrastructure is not yet sufficiently developed for large-scale blending.

The law's passage was hailed as a landmark development by Oleksandr Dombrovsky, President of MHP Eco Energy. He said the policy could bring more than $1 billion annually to the state budget through the processing of agricultural crops into bioethanol.

He also emphasized the law's historical significance, noting that although it had been under consideration for over 20 years, strong opposition from oil industry lobbyists – particularly those with ties to Russia – had previously blocked its adoption.