Amidst the crude oil supply crisis, the Sri Lankan government has increased the prices of petrol and diesel by up to 25%. After the increase today i.e. on March 22, the price of regular petrol in Sri Lanka has increased by 81 Sri Lankan rupees to 398 rupees per liter. Whereas diesel has become costlier by Rs 79 and has reached Rs 382 per liter. This is the second time in the last two weeks that the prices of petrol and diesel have been increased. Earlier last week the prices were increased by 8%. Seeing the worsening of the situation, President Anura Kumara Dissanayake has implemented ‘4 day working week’ in the country and has asked companies to return to work-from-home mode. Work-from-home instructions to save fuel An official of Ceylon Petroleum Corporation (CPC) said that the purpose of this big increase in prices is to reduce fuel consumption in the country by 15 to 20%. President Dissanayake had issued orders for government and private offices to work only 4 days a week from last Wednesday. Along with this, companies have been asked to allow employees to work from home wherever possible so that there are fewer vehicles on the roads and oil can be saved. Supply chain halted due to closure of Hormuz waterway. The biggest reason for this problem of Sri Lanka is the war between Iran, America and Israel in the Middle East. Iran has effectively closed the Strait of Hormuz as the war enters its fourth week. This is the same sea route through which about 20% of the world’s total oil exports pass in times of peace. Sri Lanka imports all its oil and coal to generate electricity, so due to supply interruption, the country is in danger of running out of stock. The fear of ‘default’ starts haunting again by 2022. The Sri Lankan government has warned that if the war in the Middle East continues for a long time, it will be difficult for the country to come out of the economic crisis of 2022. Let us tell you that after the exhaustion of foreign exchange reserves in 2022, Sri Lanka had declared ‘sovereign default’ on its foreign debt of $ 46 billion. However, it later received a $2.9 billion bailout package from the International Monetary Fund (IMF), which improved the situation slightly, but now the war has again dashed the hopes of recovery. Oil is imported from Singapore and Malaysia. Sri Lanka imports crude oil from the Middle East for its refinery, while it depends on Singapore, Malaysia and South Korea for refined petroleum products. Sri Lanka’s only refinery built by Iran is also now facing shortage of crude oil. The government had started rationing fuel last week so that stock could be saved for essential services.
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Petrol and diesel become expensive by Rs 81 in Sri Lanka: Petrol becomes Rs 398 and diesel Rs 382 per liter, effect of America-Israel and Iran war.
