After admitting the country’s economy has completely collapsed, the Sri Lankan government is closing all fuel pumps for two weeks, save for essential services.
This follows after the South Asian nation increased petrol prices by 22% and diesel prices by 15% on Saturday amid virtually running out of fuel reserves. Oil cargoes due for deployment did not show up while next week’s imports are expected to be held up due to “banking and logistical” reasons.
“From midnight today, no fuel will be sold except for essential services like the health sector, because we want to conserve the little reserves we have,” said government spokesperson Bandula Gunawardana in a prerecorded statement.
Closing down fuel pumps is the culmination so far of the country’s economic meltdown marked by rotating power outages and record high inflation. Ceylon has also seen its foreign exchange reserves deplete to record lows since late last year, leading to defaulting its US$51 billion foreign debt in April and its inability to procure import essentials.
Sri Lankan Prime Minister Ranil Wickremesinghe addressed the parliament last week saying that the country faces “a possible fall to rock bottom.”
“Our economy has completely collapsed,” Wickremesinghe said on Wednesday.
The government also called for a partial shutdown, urging private sector to arrange work from home setups for its employees as transportation is reduced to essential operations. Public school shutdowns and state institutions operating on skeleton staff were expected to end this week but has now been extended to July 10–by which fuel supplies will be restored according to Gunawardana.
Ceylon is reportedly seeking cheaper supply from Russia and Qatar.
The South Asian nation home to 22 million Sri Lankans is facing its worst economic recession since its independence in 1948. The government continues to hold discussions with the International Monetary Fund for a bailout.
Information for this briefing was found via The Guardian. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
