On Hold

May 09, 2008 (LBO) – Sri Lanka is keeping retail fuel prices at current levels despite crude oil prices soaring to new highs and mounting losses at the state oil retailer, Petroleum minister A H M Fowzie said. The state-owned oil refiner Ceylon Petroleum Corporation (CPC) had run up losses amounting to seven billion rupees (around 700 million dollars) on fuel subsidies since January 2008 when retail prices were last raised, Fowzie told a news conference.

“We have not taken a decision yet to raise prices. Retail prices were last raised in January when crude oil was 93 dollars a barrel. But even then the CPC made a loss of 1.2 billion rupees,” Fowzie said.

“Now crude oil is 30 dollars more, at 123 dollars a barrel, but we have not yet taken a decision to raise prices.

“The whole world keeps increasing retail fuel prices. It is a normal thing. But we’re not doing so. We are giving subsidies because we want to protect the consumer.”

The CPC is selling only petrol at a profit of three rupees per litre which is sold at 127 rupees.

While overpricing petrol, amidst accusations of fleecing petrol users, a large number of whom are low income motorcycle owners, the petroleum firm under-prices