Fuel Price Hike Implemented to Avoid Impact on Economy – CPC Chairman
The recent increase in fuel prices was implemented in a manner that would not adversely affect the national economy, according to the Chairman of the Ceylon Petroleum Corporation (CPC).
Speaking at a press briefing held at the CPC on Wednesday (03), he stated that fuel prices at the national level are not solely determined based on global market prices. He noted that during price revisions, both the Treasury and the Petroleum Corporation share part of the financial burden.
He further explained that in the past, fuel was sold at lower prices even when global prices increased, resulting in significant losses for the corporation. This created a large gap between procurement and selling prices.
As a result, Sri Lanka faced a severe fuel crisis in 2022, when the CPC was unable to secure sufficient US dollars for fuel imports, leading to disruptions in supply and a nationwide economic crisis, he said.
The Chairman also pointed out that global crude oil prices are currently volatile, particularly due to geopolitical tensions in the Middle East, which are affecting global supply chains.
He estimated that approximately USD 318 million is required every month for fuel imports, adding that the CPC is now responsible for raising this amount independently without direct Treasury allocation, unlike in the past.
He further stated that fuel prices are not strictly aligned with global market rates, as both the Treasury and CPC absorb portions of the cost during price adjustments, ensuring that the entire burden is not passed on to the public.
The CPC Chairman rejected criticism made for political purposes, stressing that decisions are taken carefully to avoid economic disruption and ensure continuous fuel supply.
He also noted that fuel prices may decline in the future if conditions in the Middle East stabilize, and any such benefit will be passed on to consumers.
