Sri Lankan cabinet permits companies to import fuel as crisis worsens

The Sri Lankan Cabinet on Tuesday granted to open fuel imports and retail sales market to companies from oil-exporting nations after the country ran out of fuel as only 1,100 tonnes of petrol and 7,500 tonnes of diesel are left, which are not sufficient to last for a day.

Power and Energy Minister Kanchana Wijesekera said that the companies will be selected upon their ability to import fuel and operate without Forex requirements from the CBSL and banks for the first few months of operations, reported Daily Mirror Online.

He said the Ceylon Petroleum Corporation (CPC/ CEYPETCO) will be the service provider for logistics, stocking and distribution with a service fee levied from those companies.

“Selected outlets of the existing 1,190 CEYPETCO and new outlets will be made available for LIOC and new companies which would be selected. Refinery will remain under CPC’s purview,” said Wijesekera.

With no fuel shipment in sight any time soon, the country will come to a complete standstill from this week, as even public transportation will come to a grinding halt. Not only this, but lengthened power cuts will also come into effect soon as the required stocks of fuel will not be supplied to the power plants.

This comes after Wijesekera on Saturday said that suppliers have informed state-owned fuel importer and distributor Ceylon Petroleum Corporation (CPC) that they will not make the deliveries of petrol, diesel and crude oil, scheduled for this week and next week due to banking and logistic reasons.

He added that public transportation, power generation and industries would be given priority until the next shipments arrive. Therefore, limited stocks of diesel and petrol will be distributed to a few gas stations throughout next week.

Further, on Sunday the minister announced that the fuel stations across the country will issue tokens for consumers from today, as only limited stocks of fuel were available.

He said that the government has sought assistance from Sri Lankan army and police to issue token numbers to the public to fill petrol and diesel. The public was requested to register their mobile numbers at their nearest filling stations and once their numbers were issued, they would be notified, Wijesekera added.

The minister who had been assuring the public of the arrival of a fuel vessel last week also admitted that the date of the arrival of the next fuel shipments in the county was unsure and apologized for the delay.

“We are working with all new and existing suppliers. I apologize for the delay and inconvenience,” he said.

Notably, Sri Lanka has been facing the worst economic crisis since independence in 1948, leading to an acute shortage of essential items like food, medicine, cooking gas and fuel across the island nation.

The nearly-bankrupt country, with an acute foreign currency crisis that resulted in foreign debt default, had announced in April that it is suspending nearly USD 7 billion foreign debt repayment due for this year out of about USD 25 billion due through 2026. Sri Lanka’s total foreign debt.

The economic crisis has particularly impacted food security, agriculture, livelihoods, and access to health services. Food production in the last harvest season was 40 – 50 per cent lower than last year, and the current agricultural season is at risk, with seeds, fertilizers, fuel and credit shortages.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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