Petrol, diesel prices slashed

Rafik Jalaldeen

COLOMBO: The Government yesterday announced a reduction in the price of patrol and diesel following a drop in fuel prices in the world market.

Accordingly the price of a litre of patrol will be slashed by Rs.2 and diesel by Rs. 2.50. The price reduction came into effect from midnight yesterday.

Petroleum Resources Minister A.H.M. Fowzie told the Daily News that the price reduction is in keeping with the pledge made by him to slash fuel prices whenever there was the drop in prices in the world market.

"As from today, the petrol price will be reduced by Rs.2 and diesel will be reduced by Rs.2.50 and it will come into effect immediately," the Minister said.

In terms of the reduction, a litre of Lanka Petrol (90 Octane) will now cost Rs.99, Lanka Petrol (95 Octane) Rs. 102, Lanka Auto Diesel Rs.65.50 and Lanka Super Diesel Rs.69.80.

The last price revision came into effect on September 4.

"We have increased fuel prices a number of times due to the price hike in the world market. However we didn't increase fuel prices every time the world market prices rose and we were incurring losses amounting to Rs.1,500 million," Minister Fowzie said.

"Now we trust that the people who use fuel to transport rice, vegetable and other food items will reduce price of these items for the benefit of the consumers," he added.

Earlier, Lanka Private Bus Owners Association president Gemunu Wijeratne threatened an all island private Omnibus strike if the Minister failed to consider reducing the diesel price within two weeks.

Minister Fowzie responding stated that it was totally unfair to increase bus fares as the last fare hike was done in July left a margin to absorb future oil price hikes.

Minister Fowzie predicted an oil price reduction within a month and hoped private buses will take action to reduce their fares and pass on the benefits to commuters.

"My prediction has now come true right upto the timing. We will reduce the price again and again if the fuel price will come down in the world market," Minister Fowzie said.

"We have ordered a fuel ship which is yet to arrive and we are providing fuel from available stocks at the moment," he added. The Minister declared that the price slash will be operative with immediate effect and any filling station not complying with the directive would be blacklisted.

"At the moment the Muthurajawela storage facility holds only 35,000 metric tons. We can store around 225,000 metric tons at Muthurajawela . When the ship arrives, we will divert it to Muthurajawela storage. Even if there is a recurrence in fuel price increase in the world market we can manage on the stable price for two months", Minister Fowzie pointed out.

The new fuel scheme for the three wheelers will be introduced in Battaramulla, Kegalle and Galle within a month, the Minister said.

Oil price dropped to below 60 dollars a barrel on Monday hitting the lowest price level for more than six months as tension eased over Iran.

The market also calmed after BP said it would increase output at the largest oil field in the United States.