News
West Asia war: Moves to counter impact on fuel and gas supplies
View(s):- CPC says it will strategically deploy dollar reserves and expedite tankage projects
By Sandun Jayawardena
The Ceylon Petroleum Corporation (CPC) is already restricted in the delivery terms it can offer its suppliers due to both forex and product storage limitations, CPC Chairman Saliya Wickramasuriya told the Sunday Times. “Our short-term approach to price and supply volatility due to the West Asian crisis is, therefore, to strategically deploy our USD reserves when placing orders to reduce scheduling risk, maintain clear communications with our retail competitors since we have product sharing agreements in place, and expedite our various tankage projects,” he said.
The CPC chief said that in the medium term, the corporation would bring other strategies into play, such as floating storage and tailoring the Sapugaskanda refinery to introduce a larger buffer capability and reduce refinery downtime while still supplying essential services such as the power sector and the airport.
An oil and gas industry professional said the price of gas usually rose around this time owing to the onset of winter in Europe and the resultant increase in demand. The continuing conflict between Russia and Ukraine has affected prices on the world market. “Now we have a third factor with the crisis in West Asia. If that escalates, there is all likelihood of a rise in oil and gas prices,” said the industry insider, who spoke on the grounds of anonymity.
There are fears that the conflict between Israel and Hamas could widen into a broader regional conflict, beginning with war breaking out along Israel’s northern border between its forces and the Iranian-backed Hezbollah militant group in Lebanon. Such a development has the risk of potentially dragging Iran into the conflict. The US has already deployed two of its carrier strike groups to the eastern Mediterranean in what is seen as a message of deterrence to Iran and its proxies.
The price of domestic gas cylinders was last increased on September 4. Accordingly, the price of 12.5kg of Litro Gas was increased by Rs. 145 to Rs. 3,127. The price of a cylinder of 5 kg of gas was increased by Rs. 58 to Rs. 1,256, while the price of a 2.3kg cylinder was increased by Rs. 26 to Rs. 587.
Fuel prices were last increased on October 1. In that revision, a litre of 92 octane petrol was increased by Rs. 4 to Rs. 361 while a litre of 95 octane petrol was increased by Rs. 3 to Rs. 420. Auto Diesel went up by Rs. 10 to Rs. 351 while Super Diesel was hiked by Rs. 62 to Rs. 421. Kerosene, too, was increased by Rs. 11 to Rs. 242.
Meanwhile, the Public Utilities Commission of Sri Lanka (PUCSL) announced revised electricity tariffs on Friday. Electricity tariffs rose by 18% overall as part of the latest revision.
Most Sri Lankans in Israel, meanwhile, say that while they are apprehensive about the conflict widening into a wider war, they have no intention of leaving.ax
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