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Fuel crisis: New price formula to Cabinet

07 May 2022

  • Have identified variables, to Cabinet next week: Pathirana
By Maheesha Mudugamuwa A new fuel price formula will be submitted to the Cabinet of Ministers for approval next week, Ministry of Energy Secretary M.P.D.U.K. Mapa Pathirana told The Sunday Morning. He said the Ministry was currently holding discussions with the relevant officials and had already identified the variables. “We will submit the Cabinet paper after having discussions with officers, most probably not this Monday (9), but after next week we will do it. We have identified the variables, but we have to run the regression to check the significant variables. Accordingly, we will have a discussion with officials about the best scientific manner,” Pathirana said. “We want to see what the significant factors are, it is only then we can decide whether it should be increased or decreased depending on the changing market scenario,” Pathirana said when asked if fuel prices would be increased again in the event the price formula received approval. Meanwhile, Power and Energy Minister Kanchana Wijesekera told Parliament last week that Sri Lanka had spent about $ 150 million a month for fuel two years ago. However, in May 2022 Sri Lanka is expected to spend $ 580 million for oil. “I believe a transparent price formula should be introduced for both Lanka IOC and CPC,” he said. “We do not expect to offset the full loss but to minimise the loss. By minimising the loss only, we can generate the cash to pay for the next ship.” Former Minister of Energy MP Udaya Gammanpila requested a cost-reflective pricing formula for fuel in November last year. His request to introduce a new pricing system for fuel was not approved by the then Cabinet.    


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