• Govt cites panic buying, global surge and stock depletion

A fresh fuel price hike – the second within nine days – has triggered a heated row, with the Electricity Consumers’ Association (ECA) accusing the Government of violating the fuel pricing formula to pave the way for an electricity tariff increase.

Speaking to The Daily Morning yesterday (10), ECA General Secretary Sanjeewa Dhammika alleged that the latest revision was timed strategically while the Public Utilities Commission of Sri Lanka (PUCSL) is reviewing a proposed 13.56% electricity tariff hike sought by the now liquidated Ceylon Electricity Board (CEB) for the period from 1 April to 30 June 2026.

He pointed out that under the pricing formula, fuel price adjustments are to be made only on the first day of each month. While a revision was already effected on 1 March, all fuel categories were increased again on Monday night (9), with effect from yesterday.

“This move was intended to earn an undue profit and to create conditions that would make it difficult for the PUCSL to reject an electricity tariff increase. The Government’s plan was to increase fuel prices significantly so that the PUCSL would be left with little choice but to approve a tariff hike. The public should oppose these corrupt practices,” Dhammika charged.

Accordingly, Auto Diesel was increased by Rs. 22 to Rs. 303 per litre, Super Diesel by Rs. 24 to Rs. 353, Petrol 92 Octane by Rs. 24 to Rs. 317, and Petrol 95 Octane by Rs. 25 to Rs. 365. Kerosene rose by Rs. 13 to Rs. 195 per litre. The Lanka Indian Oil Corporation PLC also aligned its prices with those of the Ceylon Petroleum Corporation (CPC).

The CPC attributed the revision to rising global fuel prices amid the ongoing Middle East conflict.

Defending the decision, Managing Director of Ceylon Petroleum Storage Terminals Limited (CPSTL) Mayura Neththikumarage said the adjustment was a precautionary step to prevent a sharper price spike later.

He explained that while Sri Lanka maintains stocks sufficient for about 30 days, fuel prices are determined based on global rates two to three days before shipments are unloaded. Although prices are usually revised based on the previous month’s average, the cost of upcoming shipments had risen significantly.

“In order to prevent a sudden surge in fuel prices and to carefully divide the available stocks between months, we normalised the price,” he said.

Neththikumarage added that the measure would help curb hoarding and ensure stable distribution without queues. He noted that if global prices decline, local prices could be revised downward within days.

CPC Chairperson D.J. Rajakaruna also pointed to panic buying as a major factor behind the hike. He said excessive purchasing in recent days, driven by fears of shortages, directly contributed to the price escalation.

“If such heavy purchasing had not occurred, it would have been possible to maintain the previous fuel prices at least until the end of this month,” he said.

At the weekly Cabinet media briefing, Cabinet Spokesperson Dr. Nalinda Jayatissa said fuel consumption had surged sharply, rapidly depleting reserves and necessitating new imports at higher prices.

He revealed that daily diesel consumption normally stands at about 4,000 metric tonnes (MTs). However, between 1 March and Monday, diesel consumption reached 59,200 MTs, while petrol consumption rose to 47,500 MTs. Within the first nine days of March alone, consumption exceeded usual levels by approximately 23,000 MTs of diesel and 13,000 MTs of petrol.

Dr. Jayatissa said global crude oil prices had risen by 37.76%, with refined products surging even more sharply. International Auto Diesel prices had increased by nearly 99.9%, Super Diesel by 99.6%, Octane 92 Petrol by about 75%, and Octane 95 Petrol by around 79%.

He warned that failure to align domestic prices with global market conditions could result in private importers reducing or halting supplies, thereby disrupting national fuel distribution.

Responding to queries about private suppliers selling previously purchased stocks at higher revised prices, he said the Government was reluctant to take punitive action as this could prompt suppliers to restrict market releases, affecting industries and the broader economy.

Although the required adjustment could have been higher, the Government opted for a smaller increase to limit the impact on the economy, he said, adding that the price revision is also expected to encourage moderation in fuel consumption.

He further assured that if global prices rise further, the Government is prepared to bear part of the cost and provide fuel at concessionary rates to the public.

Meanwhile, the PUCSL’s public consultation on the proposed 13.56% electricity tariff increase, which commenced on 25 February, will continue until 18 March. The Commission is expected to announce its decision later this month after considering public submissions and data provided by the CEB.

With fuel costs rising and electricity tariffs under review, consumers now face mounting pressure as authorities and critics trade blame over the timing and intent of the latest price hike.