News
US$ 4 billion needed for uninterrupted fuel supply
President Gotabaya Rajapaksa has summoned an emergency high-level meeting with top officials of key institutions to discuss ways of raising US$ four billion required for oil imports for the rest of the year.
The officials to be invited for the meeting include those from the Central Bank, the state-owned Bank of Ceylon and the People’s Bank, Finance and Energy ministries, the Ceylon Electricity Board (CEB) and the Ceylon Petroleum Corporation (CPC).
The meeting follows a request first submitted by the CPC to the Central Bank for money to ensure the maintenance of uninterrupted fuel supplies for both the transport and electricity sectors.
The CPC in its plan has detailed out the required quantities of petrol, diesel and crude oil and said that 88 shipments would be required to maintain uninterrupted supplies.
Accordingly, the CPC proposal says it will require 90,000 metric tonnes of petrol, 150,000 mt of diesel and 90,000 mt of crude oil a month.
The requirement for US$ four billion for fuel purchases comes in addition to the soon-to-be issued US$ 500 million credit line for fuel purchases from India.
The high-level meeting is to discuss the manner in which the funds will be made available in a timely manner to ensure the regular supply of fuel.
Meanwhile, the CPC also has requested Central Bank Governor Ajith Nivard Cabraal to provide funds for fuel supplies for the next two months.
The Central Bank Governor commenting on the payment for fuel supplies said; “These imports will be paid for with the expected merchandise and services export proceeds and the other expected inflows, which include tourism receipts and remittances.
“Since the Government and the CBSL now have a planned approach, we will be managing the cash flows to allocate the necessary funds for all the priority imports, which include foodstuff, medicine, fuel, coal, gas and fertiliser.”
The overall cash outflows are also being taken into consideration in view of loan servicing, overseas travel and educational and health services expenses of the people.
There will also be swap arrangements and project and general loans that will be an integral part of the country’s external sector cash flow statement, the CBSL Governor said.
In a related development, the CPC has decided to supply diesel at the market price to the Ceylon Electricity Board (CEB) in future, CPC Chairman Sumith Wijesinghe told the Sunday Times yesterday.
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