Fuel prices in Ukraine have risen sharply amid rising oil prices following US strikes on Iran, and may continue to rise

After the start of an open war between Israel and Iran, global oil prices have risen by 15%, leading to a sharp increase in diesel prices, especially in Europe and Ukraine. The increase in diesel prices is outpacing the increase in oil prices, Reuters reports.

ICE Low Sulfur Gasoil diesel prices have increased by almost 15% since June 12, continuing a previous trend driven by high global demand and low fuel stocks in the US and EU.

Gasoline and diesel prices in Ukraine increased by 4-5 UAH/liter in a week amid rising oil and fuel prices in the EU, as well as the appreciation of the euro. Ukraine imports fuel mainly from the EU, so a sharp increase in fuel prices in the EU is immediately reflected on price tags in Ukraine.

August Brent crude futures have already risen 20% in a month to $77/barrel, and will continue to rise this week after the US joined the strikes on Iran.

Following the US strike on nuclear facilities, Iran's parliament voted to close the Strait of Hormuz, which could lead to a further increase in oil prices, but the decision still needs to be approved by Iran's Supreme National Security Council and the Rakhbar.

However, Iran's attempt to block the Strait of Hormuz will face serious opposition from the United States, which threatens to sink Iran's entire fleet, China, which receives most of its oil from the Middle East, and the Persian Gulf countries, which will have their oil exports blocked. The only one who will benefit from this situation is Russia, which will be able to sell its oil at significantly higher prices.

Currently, 25-30% of global oil consumption passes through this strait, so blocking it could lead to an increase in oil prices by another 20-30%, which is extremely unfavorable for Trump, who promised Americans a reduction in gasoline prices during his term.