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Foreign companies cut supplies amid price surge, CPC hard pressed for distribution

The three foreign companies involved in retail fuel distribution — Lanka Indian Oil Company (LIOC), Sinopec and RM Parks — have limited their operations amid a surge in global fuel prices, leaving the Ceylon Petroleum Corporation (CPC) hard-pressed to make up the shortfall, an official said yesterday.

CPC Chairman D.J. Rajakaruna told the Daily Mirror that these suppliers accounted for 45% of the fuel distributed in the country.

“Now, 80% of diesel is distributed by us through our network of filling stations,” he said.

Asked whether fuel consumption would be further discouraged, he said a price hike would be the best option.

“We cannot tighten the QR code system to rationalize distribution because it involves substantial administrative costs. A price hike is being considered as a result,” he said.

However, he said the CPC would face constraints as diesel and petrol prices had surged in the global market within a matter of days.

Diesel prices had risen to US$174 a barrel and petrol prices to US$133 a barrel by Tuesday, he said.