Fuel distribution in crisis-hit Sri Lanka has become more challenging due to public anger and a record hike in fuel prices with people many a times spending more than a day to get fuel with the rationed quantity.
At least 40 retail stations in most populous districts remain shut due to intimidation by angry public. Shantha Silva of the fuel distributors’ association said workers at pumping stations had come under threat.
The police at a Colombo suburb said an attempt by one station to hoard 50,000 litre of fuel was thwarted. State fuel entity officials raided the station and ordered the entire stock of fuel to be released at the pre-increased prices.
The government raised the fuel retail prices at 3 am on Monday and the station owners are accused of attempting to make an undue profit of rupees 4.6 million by selling fuel at the new rates when the station had bought stocks at the old prices.
The government has raised the petrol price by 24.3 per cent and diesel by 38.4 per cent, a record hike in fuel prices amidst the country’s worst economic crisis due to the shortage of foreign exchange reserves.
With the second fuel price hike since April 19, now the most-used Octane 92 petrol would cost 420 rupees (USD 1.17) and diesel 400 rupees (USD 1.11) a litre, an all-time high.
The decision to raise the Octane 92 petrol price by 24.3 per cent or 82 rupees and diesel by 38.4 per cent or 111 rupees per litre was taken by the state fuel entity, Ceylon Petroleum Corporation (CPC).
The hike came as the public continues to suffer in long queues at fuel stations hit by shortages.
Police said that over 130 people have been arrested for hoarding fuel. The police conducted around 429 raids to seize 27,000 litres of petrol and 22,000 litres of diesel, police spokesman Nihal Thalduwa said.
Sri Lanka’s ongoing forex crisis has meant that no fuel stock piling is possible. Due to the dollar shortages, the island since January this year has been banking on an Indian Line of Credit (ILC) for fuel purchases.
With the original ILC nearing its end the government said another USD 500 million loan is to be worked out with India.
Sri Lanka has been mulling different options to facilitate measures to prevent fuel pumps from going dry, as the country faces a severe foreign exchange crisis to pay for its imports.
The island nation is grappling with an unprecedented economic turmoil, the worst since its independence from Britain in 1948. It is struggling with a shortage of almost all essentials, due to the lack of dollars to pay for the imports.
A crippling shortage of foreign reserves has led to long queues for fuel, cooking gas and other essentials while power cuts and soaring food prices heaped misery on the people.
The economic crisis has also triggered a political crisis in Sri Lanka and a demand for the resignation of President Gotabaya Rajapaksa. The crisis has already forced prime minister Mahinda Rajapaksa, the elder brother of the president, to resign on May 9.
An inflation rate spiralling towards 40 per cent, shortages of food, fuel and medicines and rolling power blackouts have led to nationwide protests and a plunging currency, with the government short of the foreign currency reserves it needed to pay for imports.
