Citi Bank help for CPC hedging

By Bandula Sirimanna

The Ceylon Petroleum Corporation (CPC) has linked up with Citi Bank, in addition to Standard Chartered Bank, for oil hedging contracts. “The CPC will award two hedges each to these two banks,” CPC Chairman Asantha de Mel told The Sunday Times FT.
He added that this financial arrangement will enable the CPC to face fuel price changes in the world market more confidently and not pass the increases to the consumer. Hedging will help save US$5 per barrel.

De Mel said through the hedging contracts with Citi Bank and Standard Chartered Bank the CPC will get price protection from any prices above the maximum price.

Earning by way of hedging has been in the region of US$2.2 million since March 2007.