LIOC smells sinister attempt over fuel crisis

Tuesday, 7 November 2017 00:00 - - {{hitsCtrl.values.hits}}

Lanka IOC Plc fears an apparent sinister motive to place the blame for the ongoing fuel shortage and resultant disruption entirely on the company despite it accounting for only 15% of the supply.

Company sources confirmed that the last shipment received from French firm Total SA on 17 October had some issues but could have been rectified with proper filtering since the cargo had some particles.

However, despite offers to fix the problem with discussions on 19, 24 and 31 October, the CPC had not been cooperative.

Given the fact that LIOC only accounts for 15% of the supply i.e. 85% onus on the CPC, the authorities as well as motorists blaming the current fuel crisis on the company is being viewed as totally unjust.

Sources alleged that the CPC perhaps had overestimated its prowess despite its shipment also being delayed and it failing to rectify the situation. This is manifested by the fact that CPC had not agreed to LIOC’s offer to resolve the issue concerning its latest shipment. Usually a shipment of fuel takes around 20-25 days at most.

“Being the dominant player, CPC should bear the larger responsibility for the current crisis, especially since it rejected mitigation measures proposed by LIOC,” knowledgeable industry analysts told the Daily FT.

Despite the apparent “cold or unfair treatment” for mysterious reasons by CPC, LIOC had proceeded with an emergency supply of 15,000 metric tons from its parent IOC, due by 10 November directly from India.

With regard to the rejected oil tanker anchored at the Trincomalee harbour, LIOC sources said that it was the responsibility of TOTAL SA, as a duty had to be paid to the Lankan authorities before the tanker could be removed from the port.

The crisis also comes as LIOC has been urging an upward revision in fuel prices, stating that currently it (as well as CPC) is incurring a Rs. 22 loss per litre of petrol and Rs. 14 for a litre of diesel.