After bankrupt Sri Lanka defaulted on its foreign debt payments this week, Sri Lankan state-run Ceylon Petroleum Corporation (CPC) announced that starting from today, it will be rationing the amount of fuel available at its pumps across the country.
The CPC controls around two thirds of Sri Lanka’s fuel market, with Lanka IOC – a local subsidiary of the Indian Oil Corporation – controlling the rest.
Drivers in cars, vans, and SUVs will be limited to 19.5 liters (5.15 gallons) of fuel per purchase, while motorcyclists will be restricted to 4 liters (1.05 gallons), CPC said. Drivers will also be forbidden from filling fuel cans at the pumps.
According to the sources in the country’s government, Lanka IOC will likely follow CPC’s suit and introduce rationing at its own stations in the near future.
Gas stations across the Sri Lanka are running out of fuel, while cooking gas is also in short supply, with Litro Gas – the country’s main distributor – saying it won’t have any available until Monday.
Food items have increased fourfold in price in Sri Lanka, and long lines for staples like rice, milk powder, and medicine have been reported nationwide.
Earlier, food and energy shortages have triggered mass protests against President Gotabaya Rajapaksa’s government.
The entire government of Sri Lanka resigned earlier this month, leaving President Gotabaya Rajapaksa and his older brother, Prime Minister Mahinda Rajapaksa, to form a new government. Protesters, however, have continued to gather in the capital of Colombo, blaming the president for their economic misfortune.
Sri Lanka’s crisis was in part accelerated by the COVID-19 pandemic, as the island nation has lost substantial revenue generated by tourism.
High government spending and tax cuts then depleted state coffers, and the state’s attempts to pay off foreign bonds by increasing money printing led to skyrocketing inflation.
Russia’s aggression in Ukraine and subsequent Western banking sanctions on Moscow have made it difficult for Sri Lanka to export tea – a vital cash crop – to Russia and have contributed to rising fuel prices.
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