COLOMBO (Reuters) -Sri Lanka will permit firms from oil-producing nations to import and promote fuel, the ability and vitality minister stated on Tuesday, ending a duopoly because it tries to overcome a scarcity of petrol and diesel that’s exacerbating an financial disaster.
The Cabinet determination got here because the minister, Kanchana Wijesekera, headed to Qatar and a colleague was due to arrive in Russia on Sunday for talks on vitality offers with officers there.
Sri Lanka is struggling its worst financial disaster since its independence, with international alternate reserves at a document low of $1.92 billion, in accordance to the Central Bank, although analysts estimate a decrease stage of useable funds.
The island of twenty-two million individuals is struggling to pay for important imports of meals, drugs and, most critically, fuel.
The authorities closed city colleges for about two weeks from Tuesday and allowed fuel provides solely to providers deemed important like well being, trains and buses as shares would solely final solely per week or so primarily based on common demand.
“Cabinet approval was granted to open up the fuel import and retail gross sales market to firms from oil-producing nations,” Wijesekera stated on Twitter.
“They can be chosen on the power to import fuel and function with out foreign exchange necessities from the CBSL (central financial institution) and banks for the primary few months of operations.”
The state-run Ceylon Petroleum Corporation (CPC) controls about 80% of the fuel market and Lanka IOC, a unit of Indian Oil Corporation, the remaining.
The Cabinet additionally allowed bunkering firms already registered with the federal government to import jet fuel.
Sri Lanka wants about 1.2 million litres of so-called A1 jet fuel a day to provide airways however the CPC has been unable to meet the requirement, the federal government stated in a press release.
“The Cabinet made this determination to be certain that flights are usually not disrupted due to the fuel scarcity,” it stated.
Wijesekera flew to Qatar late on Monday evening whereas Education Minister Susil Premajayanth is due to arrive in Russia on July 3.
Wijesekera hopes to discover a long-term fuel provider in Qatar who’s “keen to work with Sri Lanka’s international alternate and different challenges”, stated a ministry official, who declined to be recognized as he’s not authorised to converse to media.
Wijesekera informed reporters on Sunday Sri Lanka had been in talks with numerous nations, together with Russia, for weeks on shopping for fuel.
Traffic was mild on Tuesday on the streets of the principle metropolis of Colombo, with metropolis colleges shut and most private and non-private sector staff working from house.
But buses and trains have been operating and outlets have been open for groceries and different necessities.
(Reporting by Uditha JayasingheWriting by Krishna N. Das; Editing by Kim Coghill, Robert Birsel)
