In late February, according to monitoring results, there was fixed a tendency for the upcoming spring: on European hubs, the price of gas falls. The import parity of gas prices and, accordingly, the level of gas prices in Ukraine is becoming much lower than it was in 2018. That is, since April, the industry in Ukraine has begun to pay less than the population.

The Government has come up with a decision that is supported by our international partners, in particular, the International Monetary Fund, and obliged Naftogaz of Ukraine to sell gas to the population at a cheaper price.

Instead of taking into account the opportunities provided by the Resolution of the Cabinet of Ministers dated April 3, 2019 No. 293 to reduce the price without any economic arguments, which contradicts the market trend for a price cut, the monopolist has raised prices for industry. This has led to an increase in the price of gas in June for the population. And this is at the time when at the gas market in Ukraine, as is confirmed by the Ukrainian Energy Exchange, it is considerably lower.

Therefore, today the Government has taken another decision, which disables speculations of Naftogaz with gas prices. Since June, Naftogaz is obliged to sell gas to the population at the lowest price from one of four platforms:

1. Ministry of Economic Development - average customs value of imported gas, expected from May, makes up UAH 5,600 - 5,700 per one thousand cubic meters excluding VAT;
2. Ukrainian Energy Exchange - the gas for June was sold at a price of UAH 5,554 per one thousand cubic meters excluding VAT;
3. Naftogaz - gas for the industry on pre-payment, set for June makes up UAH 5,804 per one thousand cubic meters excluding VAT;
4. Or at the price according to Regulations on applying special obligations to the natural gas market participants, pursuant to the Cabinet of Ministers Resolution No. 867, which is calculated for June at UAH 7,185 per one thousand cubic meters excluding VAT.

This means that in June, Naftogaz should reduce its gas price, which was set for June, at UAH 6,299 per one thousand cubic meters excluding VAT. The price for the population, under the Governmental decision, should be by UAH 800-900 lower.

Moreover, the Government has also set up an interagency group to verify the formula for setting the price of gas by Naftogaz. Meanwhile, the monopolist only agreed last week to enter gas trading on the Ukrainian Energy Exchange. We will explore in synergy with MPs the actual expenditures of Naftogaz for natural gas for the needs of the population.