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37,000-tonne diesel shipment to be delayed further by LC

02 Mar 2022

 
  • LC yet to be opened despite shipment arriving today
  • Another shipment of 28 K tonnes diesel, 9 K tonnes aviation fuel by 4 March
  BY Shenal Fernando The required letter of credit (LC) had not yet been opened for a 37,000 tonnes (t) shipment of diesel which is set to arrive from Singapore today (2) as of yesterday (1), indicating a further delay in the releasing of the shipment of fuel. When The Morning Business reached out to Energy Minister’s Media Spokesman Chaminda Hettiarachchi yesterday, he declined to provide definite confirmation that the ship will arrive today, claiming, however, that it is scheduled to arrive. He admitted that the LC in relation to the shipment has not been opened yet. This shipment of diesel had originally been scheduled to arrive in the country on 28 February. However, the Energy Ministry later clarified that the shipment in question had been delayed by two days due to the holdup of the ship at the loading port due to certain undisclosed disruptions. Sri Lanka is scheduled to receive another shipment of 28,000 t of diesel and 9,000 t of aviation fuel by 4 March, and currently, 35,300 t of petrol are being unloaded at the Colombo Port following the opening of the required LC of $ 30 million.  Commenting on the current fuel crunch in the country, Energy Minister Udaya Gammanpila stated at a press conference organised by the Ministry on 28 February that the Ceylon Petroleum Corporation (CPC) has exhausted its fuel stocks due to consecutive delays in making the necessary payments and releasing the fuel shipped to Sri Lanka. “Therefore, until the next ship arrives, we will be able to release only limited stocks to the market, and therefore, fuelling stations will have to strictly ration the fuel given to every person.” He further claimed that no decision has been made to increase the price of fuel sold by the CPC despite the Lanka Indian Oil Corporation (LIOC) increasing the price of fuel twice during the month of February to reflect the drastic increase in fuel prices observed in the world market. Accordingly, during the month of February, the LIOC has increased the price of diesel by Rs. 22 and the price of petrol by Rs. 23 in two separate price hikes. However, he also refused to confirm that there will be no fuel price increment, claiming that he is unable to give a permanent statement regarding the prices of fuel in such an impermanent world. He further stated: “The two state banks have stated that the level of debt owed by the CPC has reached critical levels and that they will not be granting us further loans. The Government is also not providing any financial assistance, nor is it reducing the taxes on fuel. This means that we will not be able to source the required quantities of fuel and hence, there will be a fuel shortage.” He further called on the Government to identify its priorities, stating: “Will we stay in the dark while eating apples and grapes or drink imported water without fuel for our vehicles or will we sacrifice them and will we, in using our limited foreign currency reserves, prioritise the payments for essential goods such as medicine and fuel? The Government must make a decision on this and it is due to the failure to do so that we are in the current situation where we have apples and grapes but no fuel, and we have imported honey but no medicine.” Considering the current diesel shortage and its effect on private buses, Vehicle Regulation, Bus Transport Services and Train Compartments, and Motor Car Industry State Minister Dilum Amunugama stated that Finance Minister Basil Rajapaksa had informed him to commence an initiative to supply the fuel requirements of private buses engaged in public transport through the CPC and that such an initiative will be initiated within two to three days.


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