Sri Lanka allows fuel imports, sales to ease shortages

• Sri Lanka’s foreign exchange reserves are at a historic low of $1.92 billion.
• The 22-million-person island struggles to import food, medicine, and gasoline.
• The government halted urban schools for two weeks on Tuesday and limited gasoline supplies to key services.

COLOMBO: Sri Lanka will allow oil-producing countries to import and sell petroleum, the power and energy minister said Tuesday, eliminating a duopoly and easing an economic crisis.

Kanchana Wijesekera, the minister, was going to Qatar, while a colleague was going to Russia on Sunday to talk about energy.

Sri Lanka’s foreign exchange reserves are at a historic low of $1.92 billion, according to the Central Bank. However, analysts predict a lower workable level.

The 22-million-person island struggles to import food, medicine, and gasoline.

The government halted urban schools for two weeks on Tuesday and limited gasoline supplies to key services like health, railroads, and buses since supplies would only last a week based on demand.

“Cabinet approval was granted to open up the fuel import and retail sales market to companies from oil-producing nations,” Wijesekera tweeted.

“They will be selected on the ability to import fuel and operate without forex requirements from the CBSL (central bank) and banks for the first few months of operations.”

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80% of the fuel market is controlled by Ceylon Petroleum Corporation (CPC) and Lanka IOC, which is a part of the Indian Oil Corporation.

The Cabinet approved bunkering companies to import jet fuel.

Sri Lanka requires 1.2 million gallons of A1 jet fuel a day to supply planes, but CPC can’t match the demand, the ministry claimed.

The Cabinet made this decision to prevent fuel shortage-related aircraft disruptions.

Education Minister Susil Premajayanth will arrive in Russia on July 3.

A ministry official said that Wijesekera aims to locate a long-term fuel supplier in Qatar “ready to deal with Sri Lanka’s foreign exchange and other issues.”

Wijesekera told reporters Sunday that Sri Lanka had been in fuel talks with Russia for weeks.

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