Crude Intermediation will resolve fuel crisis

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The Government should ease the market restrictions and facilitate Crude Intermediation as a solution to the present fuel crisis, especially the kerosene shortage, Singularity Sri Lanka requested.

Speaking to the Media on 24 June regarding the crisis faced by those who live in condominiums and housing flats due to the fuel crisis, especially the kerosene and domestic gas shortage, Founder of Singularity Sri Lanka, Manju Nissanka said Crude Intermediation has been suggested to the Government in a few forums as an alternative solution to the existing fuel crisis, yet it fell on deaf ears.

“We suspect that if this method is implemented, the Government and the public sector authorities fear that their corruption will come to light. Therefore, they ignore at least trying this method as an alternative to solve the issues of the working class who have been spending days in fuel queues just to find gas or kerosene to feed their families and children,” he added.

In Crude Intermediation, crude oil or any other kind of fuel will be bought from a country or an international organisation. The whole process of bringing fuel into the country will be undertaken by a special purpose vehicle (SPV) and handed over to an internationally-recognised investment bank or a commodities brokerage company.

“To do this, the present market restrictions should be relaxed. At this juncture, the Government has no money to import fuel. Crude Intermediation is a perfect solution for this situation. If this method is implemented, the fuel crisis could be resolved within a few months. The private sector, which has dollars to invest and import the fuel, can invest in this, while the Government can handle distribution and other aspects. Customers too could buy fuel without falling victim to long queues and black market prices,” Nissanka pointed out.

Meanwhile, Ceylon Today on 26 April reported that Co-Cabinet Spokesman Dr. Ramesh Pathirana said Cabinet had approved amending the Petroleum Products (Special Provisions) Act, No. 33 of 2002, to include provisions for issuing licenses to “properly identified parties.”

He said Cabinet approved the Minister of Energy’s proposal to advise the Legal Draftsman to amend the Petroleum Products Act (Special Provisions).

He said during the weekly Cabinet briefing that these steps will be taken to allow them to import fuel for sectors such as electricity, fisheries, and exports.

“All economic activities in the country rely on fuel. Thus, it has been determined that it is appropriate to grant licenses to specific sectors of the economy to import and use the fuel they require on an individual basis,” he said.

By Nabiya Vaffoor