IOC provides fuel as government pumps run dry
Lanka IOC, the Indian Oil Corporation’s subsidiary in Sri Lanka, kept its pumps open throughout Tuesday as the cash-strapped government entity’s gas stations did not operate in the nation. island due to the worsening energy crisis.
On Monday, the Sri Lankan government announced that only essential services will operate from midnight until July 10 and that all other operations will be temporarily suspended as the country in crisis faces a severe fuel shortage.
A LIOC spokesman said they distributed gasoline to private vehicle owners on Tuesday, but had to limit problems due to demand.
The government issued tokens to vehicles that had been queuing for more than 3 days. The military, which issued the tokens, said it would have priority when normal deliveries resume by state-owned Ceylon Petroleum Corporation (CPC).
Sri Lanka’s unprecedented economic crisis caused by the shortage of foreign exchange has led to a severe crisis in the energy sector. Fuel shortages led to long queues at retailers and with the end of India’s $700 million line of credit, pumps dried up.
The Sri Lankan government is exploring options to buy oil at a discount from Russia, as the island nation desperately seeks to replenish its dwindling fuel stocks amid an unprecedented economic crisis due to a crippling fuel shortage. foreign exchange reserves.
Angry people waiting in the fuel queue want President Gotabaya Rajapaksa and his government to resign immediately over their failure to address fuel shortages.
Since June 24, no tanker trucks with supplies have arrived in the island nation while the CPC says no new orders have been placed.
On Monday, Sri Lankan Energy Minister Kanchana Wijesekera traveled to Qatar to work out a credit purchase agreement with the oil state.
Meanwhile, the government statistics office said on Tuesday that economic growth in the first quarter of this year is expected to grow by minus 1.6% due to the economic crisis.
A statement said fuel shortages impacted all sectors, with reduced production contributing to negative growth.
The decision to stop imports of chemical fertilizers due to the currency crisis also contributed to the loss of crops.
The country on the brink of bankruptcy, with an acute foreign exchange crisis that led to a foreign debt default, announced in April that it was suspending repayment of nearly $7 billion in foreign debt owed for this year on about $25 billion due through 2026.
Sri Lanka’s total external debt stands at $51 billion.
Sri Lankans continue to languish in long queues for fuel and cooking gas as the government is unable to find dollars to finance imports.
So far, it is estimated that there have been twelve deaths in the fuel queues due to exhaustion, physical ailments or accidents.
Indian lines of credit for fuel and basic necessities have provided lifelines until ongoing talks with the International Monetary Fund can lead to a possible bailout.