Presidential Committee to probe fuel shortage

Sri Lanka President Maithripala Sirisena

President Maithripala Sirisena yesterday appointed a Cabinet Sub-Committee to probe the cause of the crippling fuel shortage prevailing in the country.

Sri Lanka Freedom Party (SLFP) General Secretary Minister Duminda Dissanayake said Petroleum Resources Development Minister Arjuna Ranatunga too had made a request from the President to appoint a committee to probe the issue.

The Cabinet Sub-Committee will investigate whether there was a delay in ordering the fuel consignment and the reasons for the sudden malfunctions in the oil refinery. The Committee will also probe how a consignment of substandard fuel arrived in Sri Lanka and whether that fuel stock was of a proper standard.

The sub-committee comprises Mega polis and Western Development Minister Patali Champika Ranawaka, Special Assignments Minister Sarath Amunugama and Disaster Management Minister Anura Priyadarshana Yapa.

According to the findings of the investigations, action will be taken against those responsible for the crisis, the minister added.

Addressing the weekly SLFP press briefing in Colombo yesterday, the Minister said the primary reason for the fuel crisis was the delay in the shipment which was expected on November 2.

“We are expecting another shipment today which will end the fuel shortage,” he said. He said the biggest contributor to the shortage was impulse and panic buying on the part of consumers who feared an all out shortage.

“We are glad that we stopped substantial fuel from entering the market. It is essential to improve the storage facility even though the previous government did not do so. But, the present government has formulated plans to increase the storage facility to avoid similar shortages in the future,” he said.

Meanwhile, the vessel Neverska Lady which left Jabel Ali port on November 1 with a gross load of 27,505 tonnes was expected to arrive in Colombo shortly.

Demand has doubled

Petroleum Resources Development Minister Arjuna Ranatunga who tendered a public apology cited that the government had a buffer stock to cater to 80 percent of the demand until tomorrow (Wednesday). However, according to the CPC, the usual consumption of petrol which used to be at 2000 MT per day has doubled during the last three days, creating a scarcity in the market.

Emergency purchase expected to arrive today

In order to remedy the situation, CPC went into making emergency purchases in the spot market until the situation normalises. It is learnt that a shipment of 40,000 MT is expected today and that CPC has made arrangements for an emergency purchase of 85,000 barrels of petrol.

Rationing distribution and supply

In order to ration this distribution, Upali Marasinghe, Secretary to the Ministry of Petroleum Resource Development issued a circular yesterday requesting the owners of Petrol sheds islandwide not to sell petrol in bottles and cans and for it only to be pumped to vehicles. He added that due to unwarranted rumours of an all out shortage, people were queuing up with bottles and plastic cans. The move however has drawn flack from the Ceylon Motorcyclists Association who in a letter to the Minister pointed out that this mode of distribution was impractical since there are vehicles that would have stopped on the road after running out of fuel. It would also affect supply for generators and industrial machines that are used on a daily basis they said.

There were also reports of petrol being sold on the black market for higher prices. Marasinghe called on public to use petrol sparingly until the sheds were restocked with sufficient supplies.

LIOC denies all charges levelled against them

Amidst the furore over the shortage of fuel, is a blame game that has taken over centre stage. During a media briefing, the Minister said that they would “usually import oil when the available stocks are down. In this case,what happened was stocks of the LIOC were below standards and we rejected it. There was pressure on me to accept the stocks, but I refused. Thereafter they promissed to get another shipment before the end of the month, but that did not arrive.”

Meanwhile LIOC in a lengthy statement refuted the accusations caste on them adding that they only cater to 16% of the market share, while the rest is dominated by CPC. “The large shortages across the country can only be caused by disruption in supplies of CPC,” they said. “Average daily sales of LIOC is 600 MT of petrol. Against this, as on date, LIOC has a buffer stock of 3500 MT of petrol at the Common User Facility (CUF), which is managed by CPSTL.

It may be noted that LIOC has adequate stocks of diesel at both trincomalee terminal and at CUF and normal daily diesel sales of 775 MT is continuously happening from all our sheds across the country. It is total misrepresentation of facts that diesel is not being sold by LIOC sheds.”

They have also categorically denied rumors that they compelled CPC to buy the initial purchase of fuel which was found to contain particles of iron dust in them. “Allegations that LIOC pressurised CPC to accept the original parcel without correction is totally false…” their communiqué clarified.

Furthermore they added that on various occasions in the past, LIOC has offered assistance to CPC to procure emergency shipments of petroleum products and will continue to do so whenever required. “As a responsible petroleum company, at the times of strike, LIOC has always worked round the clock to make the product available to the citizens of the country.”

Speculation over petrol price hike

Speculation is rife that there maybe an increase in fuel prices since the CPC had been forced to make spot purchases to avert the current fuel crisis. However, Minister Ranatunga told in that fuel prices will not be increased. The LIOC, however, has been agitating for a price hike due to mounting losses in the backdrop of a surge in international fuel prices.

(Source: Daily News – By Irangika Range and Rukshana Rizwie)