Amount of fuel to be imported under USD 500 mn Indian credit line will be less due to steep hike price

By Rathindra Kuruwita

Minister of Energy Gamini Lokuge said yesterday that the amount of fuel that Sri Lanka would receive from India, through a USD 500 million credit line, would be lower than expected due to the rapid increase in fuel prices in the international market.

The Minister said that the price of a barrel of Brent crude had reached USD 130 on Tuesday.

“This is a big jump in price compared to when we came to an agreement with India, By 15 March we should get about seven or eight ships of oil from India” he said.

The Minister added that the CPC incurred a loss of around Rs. 80 on a litre of diesel. However, it was not planning to increase the prices of fuel considering the inconvenience to the people. Last week, the Central Bank urged the government to increase the prices of fuel to reflect the market rates.

“There are now no queues for petrol. The queues for diesel are becoming shorter. By next Tuesday the fuel shortage will be solved. We had a number of meetings with the Finance Minister and he has agreed to provide the necessary funding to purchase fuel. Dollars have been released to pay for oil tankers that have arrived here,” he said.

The Minister added that they were also planning to run the Sapugaskanda oil refinery at full capacity and that they had conducted discussions with several companies to purchase crude oil

“Letters of Credit are being opened to purchase crude oil,” he added.