Pricing Issue

April 16, 2008 (LBO) – Sri Lanka would raise fuel prices before the end of the month after running losses of 7.2 billion rupees in 2008, petroleum minister A H M Fowzie said. Up to April 15, the state-run Ceylon Petroleum Corporation had lost 1,856 million rupees.

In March the utility had lost 3,769 million rupees from its marketing activities, though it earned about 700 million rupees from fuel hedging deals and its refinery also made profits.

In February it had lost 1,216 million rupees. In January it lost 1,191 million rupees after a price hike which brought in 1,022 million rupees.

In January and February CPC’s refinery was closed for repairs.

The utility had come under fire for overpricing petrol and fleecing its smaller customers while giving subsidies to large commercial customers and richest sections of society including politicians that used diesel to power their luxury jeeps.

As a result motorcycle and small car owners end up subsidizing rich people and businesses.

Fowzie said the utility now made 5.00 rupees on each litre of petrol sold, lost 31 rupees on each litre of diesel and 40 rupees on each litre of kerosene.

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