October 12, Colombo (LNW): President Anura Kumara Dissanayake has announced plans to revise agreements with private fuel suppliers, arguing that existing contractual conditions restrict the government’s ability to regulate the market and protect consumers from steep price increases.
Addressing a National People’s Power (NPP) rally in Ibbagamuwa, the President said certain provisions in agreements with private operators had constrained the Ceylon Petroleum Corporation (CEYPETCO) in setting prices and responding effectively to market developments.
He indicated that changes would be introduced to give the government greater flexibility in managing fuel distribution and addressing potential supply disruptions.
Dissanayake maintained that consumer interests would remain central to the government’s approach, insisting that private companies should not be allowed to dictate market conditions at the expense of the public.
He also claimed that CEYPETCO had moved from operating at a loss to generating profits under the current administration. The government, he said, was determined to maintain a dependable fuel supply while preventing excessive costs from being passed on to motorists and businesses.
The President defended the administration’s recruitment policy at the state-owned corporation, saying only 10 employees had been recruited during the government’s first two years in office. Four engineers were assigned to oversee newly established projects, while six employees were involved in developing aircraft refuelling services at Bandaranaike International Airport in Katunayake.
He contrasted this approach with what he described as excessive recruitment under previous administrations, arguing that the current government was prioritising institutional efficiency and financial discipline over expanding the public-sector workforce.
A major point of contention, according to the President, has been the difference between the diesel prices sought by private suppliers and those maintained by CEYPETCO. He claimed that one private company had requested a price increase of Rs. 132 per litre, while another had sought an increase of Rs. 116 per litre.
The government, he said, had restricted the increase implemented through CEYPETCO to approximately Rs. 10 per litre while providing a subsidy of Rs. 70 to help cushion the impact on consumers.
Dissanayake further alleged that some private suppliers were facing shortages because they were unwilling to distribute fuel without the larger price increases they had requested. He argued that existing contractual arrangements limited the government’s ability to take legal action against suppliers in such circumstances, strengthening the case for renegotiating the agreements.
The President also highlighted a significant change in the diesel market, claiming that CEYPETCO’s share had risen from 58 per cent to 77 per cent. He suggested that the state-owned corporation could expand its role further if private operators failed to meet demand.
“If they cannot supply the remaining 23 per cent, we will do it ourselves,” he said.
According to Dissanayake, private suppliers had been informed that they could continue selling fuel at prices of their choosing under the existing arrangements, while CEYPETCO would maintain its own pricing structure. However, the proposed revisions to private-sector agreements could mark a shift in how the government manages competition, pricing and supply responsibilities within Sri Lanka’s fuel market.
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