Fuel supplies disrupted across Sri Lanka as private firms seek relief from rising costs

Fuel supplies in Sri Lanka have been disrupted after private distributors reduced diesel deliveries, citing steep increases in global fuel, shipping, insurance and security costs amid uncertainty around the Strait of Hormuz.The Fuel Distributors' Association on Monday urged the government to intervene, warning that the reduced supplies were affecting fuel stations across the island nation.The association said three private operators, Lanka IOC (LIOC), Sinopec and RM Parks, had reported substantial losses on diesel sales and were supplying lower quantities than ordered.The companies are reportedly losing around LKR 170 per litre on diesel due to a sharp rise in international fuel and shipping costs, along with higher insurance and security expenses amid uncertainty surrounding the Strait of Hormuz and risks to oil tankers."We seek the intervention of President Anura Kumara Dissanayake to settle this problem,” association representative Kumar Rajapaksa told reporters."They only supply reduced quantities for orders. This has badly affected our capacity to run fuel distribution outlets," he said.Private operators account for a significant share of Sri Lanka's fuel distribution network. LIOC has about 20 per cent of the market, while Sinopec and RM Parks account for around 10 per cent and 5 per cent, respectively.The disruption could have wider economic implications as Sri Lanka relies heavily on diesel for public transport, agriculture, construction, industrial machinery, private vehicles and backup power generators.State-owned Ceylon Petroleum Corporation Chairman D J Rajakaruna said the company was continuing to absorb losses on fuel sales as part of its "national duty".Energy Minister Anura Karunathilaka said the government may consider either subsidising diesel to offset rising costs or increasing its retail price.The development comes amid disruption to global oil supplies linked to the US-Iran conflict and uncertainty around the Strait of Hormuz, a major route for international petroleum shipments.Catch the latest World News and Live updates. Download the TOI app.