Sri Lanka lacks money to import oil

In the island nation of Sri Lanka, the state energy company CPC has run out of money to buy and import oil.

Energy Minister Udaya Gammanpila said in Colombo today that previously the country lacked dollars to import oil, it now lacks rupees to buy dollars. According to the information, the loss-making company accumulated losses of 83 billion rupees (a good 360 million euros) last year alone.

Among other things, the sales prices for diesel set by the government have a negative effect, said the minister. CPC suffered losses of 42 percent as a result. Even tax increases would not solve the problem, said the minister. He warned of shortages – “unless we raise prices or the Treasury offers a bailout”.

The small country’s energy sector depends on imports to meet the needs of around 22 million people. Food prices have also risen sharply, with food prices rising by 25 percent over the past month. Revenue from the tourism industry has largely failed to materialize in the coronavirus crisis.