Sri Lanka Economic Crisis: Lanka IOC Provides Fuel As Government-Run Pumps Go Dry

Sri Lankan on Monday announced that only essential services will operate from midnight till July 10 and all other operations will be temporarily suspended as the nation faces an acute fuel shortage

Lanka IOC, a subsidiary of Indian Oil Corporation, said they provided petrol to private vehicle owners on Tuesday but had to limit the issues due to the demand.

Source : Getty

The subsidiary of Indian Oil Corporation (IOC) in Sri Lanka, Lanka IOC, kept its fuel pumps open throughout on Tuesday as the cash-starved government’s pumping stations did not operate because of the worsening energy crisis, as reported in the PTI.

The Sri Lankan government on Monday announced that only essential services will operate from midnight till July 10 and all other operations will be temporarily suspended as the nation faces an acute fuel shortage.

A spokesperson of Lanka IOC said they provided petrol to private vehicle owners on Tuesday but had to limit the issues due to the demand.

According to the report, the government issued tokens to vehicles that had waited in long lines for over three days. The military, which issued the tokens, said they would be given priority when the normal deliveries are resumed by the state-run Ceylon Petroleum Corporation (CPC).

Lanka IOC in a tweet shared about the curbs saying, “Lanka IOC with immediate effect restricts sales of Petrol as follows: 2 Wheelers : Rs.1500/- 3 Wheelers : Rs.2500/- 4 Wheelers : Rs.7000/- Inconvenience caused is deeply regretted.”

Lanka IOC with immediate effect restricts sales of Petrol as follows::
2 Wheelers : Rs.1500/-
3 Wheelers : Rs.2500/-
4 Wheelers : Rs.7000/-
Inconvenience caused is deeply regretted..

— Lanka IOC PLC (@LankaIOCPLC) June 28, 2022

The economic crisis in Sri Lanka was caused by forex shortages that led to a severe crisis in the energy sector. With the end of the credit line worth $700 million granted by India, the pumps have again run dry.

The Sri Lankan government is now exploring options to purchase discounted oil from Russia, as the island nation desperately looks to replenish its dwindling fuel stocks.

Angry people waiting in the queue for the fuel want President Gotabaya Rajapaksa and his government to resign immediately for their inability to tackle the fuel shortages. Since June 24, no fuel tankers with supplies have arrived in the island nation, while the CPC said no new orders have been placed.

Sri Lanka’s statistics office said on Tuesday that the economic growth in the first quarter of this year is projected to see a minus 1.6 per cent growth.

A report mentioned that fuel shortages had impacted growth in all sectors, with reduced production contributing to the negative growth. A decision to stop chemical fertiliser imports due to the forex crisis too had contributed to the loss of crops.

The nearly-bankrupt country, with an acute foreign currency crisis that resulted in foreign debt default, had announced in April that it is suspending nearly $7 billion foreign debt repayment due for this year out of about $25 billion due through 2026.

Sri Lanka's total foreign debt stands at $51 billion. Sri Lankans continue to languish in long fuel and cooking gas queues as the government is unable to find dollars to fund imports.

Meanwhile, Sri Lanka’s Energy Minister Kanchana Wijesekera on Monday visited Qatar to work out a credit purchase agreement with the state.