Fuel queues return to Sri Lanka as private operators slash supply

Sri Lanka
By Editor_1
Fuel queues reappeared in Colombo on Monday (October 5, 2026), due to what the government described as private fuel distributors reducing supplies to the domestic market because losses incurred under the government’s regulated fuel pricing structure – economynext.com/File

COLOMBO – Private fuel distributors in Sri Lanka have reduced supplies to the domestic market because they are incurring losses under the government’s regulated fuel pricing structure, Energy Minister Anura Karunatilaka told Parliament on Tuesday (6), as fuel queues re-emerged in Colombo.

The minister said Lanka IOC, Sinopec and RM Parks had informed the government that they could not continue selling fuel at prevailing domestic prices, which were below their costs.

“However, we do not have the ability to increase prices proportionately. In light of this, they have restricted the fuel released to the market,” Karunatilaka said, explaining that Lanka IOC had reduced its market releases, compared with February, by 45% for auto diesel, 88% for Euro Super Diesel and 3% for 92 Octane petrol.

Sinopec, he said had reduced diesel supplies by 66% and 92 Octane petrol by 30%.

The reduction in private-sector supplies has placed an increased burden on the state-owned Ceylon Petroleum Corporation (CPC), whose share of fuel supplied to the market has risen from 54% to 82%, according to the minister.

Compared with February, CPC has increased market releases of diesel by 28%, Super Diesel by 44%, 95 Octane petrol by 7% and 92 Octane petrol by 19%, he said.

Responding to questions from the Opposition, Karunatilaka said the government did not have the authority under existing agreements with private operators to direct individual fuel stations on how to distribute their supplies.

“What we are able to do is issue certain directives to maintain minimum fuel stock levels within Sri Lanka,” he said.

The minister said notices had been issued last week to companies that had failed to maintain the required minimum stocks, while the Ministry Secretary had also instructed fuel companies on Monday (5) to take steps to prevent shortages.

Karunatilaka attributed the fuel queues observed over the past two days primarily to the restrictions imposed by private operators, compounded by the fact that fuel is generally not released to the market on Sundays and the resulting impact on Monday supplies.

He also said private fuel companies did not provide fuel on credit, whereas the CPC continued to supply fuel under arrangements allowing a three-day advance window.

“As this additional load is being absorbed by the Ceylon Petroleum Corporation, we believe and anticipate that this issue will ease to some extent by Wednesday (7) or Thursday (8),” the minister told Parliament.

–ENCL

Editor_1
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