Friday Oct 09, 2026
Friday Oct 09, 2026
Thursday, 8 October 2026 05:30 - - {{hitsCtrl.values.hits}}
The Government will seek legal advice on action against private fuel suppliers under the Petroleum Act if they continue to restrict fuel distribution to filling stations, Energy Minister Anura Karunathilaka told Parliament yesterday.
“If this situation continues, we will seek legal advice and take action,” he said.
Any action would be taken in line with the agreements signed with the suppliers and the powers vested in the Ministry, the Minister said. Discussions with fuel operators are scheduled at the Presidential Secretariat, and further action would be considered if the companies fail to reach an agreement and continue to impose restrictions.
According to Karunathilaka, the problem arose after the Government decided not to raise domestic fuel prices in line with rising global prices, leaving private suppliers to incur losses. The companies had sought an increase in local prices to world market levels.
“Because we cannot do that, we have taken steps to give them a Rs. 70 subsidy on diesel for the next three months. But because they are still making losses, they have placed some limitations on supplies to the market,” he said.
Private suppliers have cut back on the grounds that their costs exceed the subsidy, which the Government provides to keep retail prices below world market levels.
The shortfall has been taken up by the Ceylon Petroleum Corporation (CPC), which has stepped up distribution. Its share of the domestic market has risen to around 77% to 80%, from 50% to 55% before the price controls, Karunathilaka said.
“What we can do is increase supplies by the CPC and reduce the problem to some extent,” he said.
The Ministry has also asked private suppliers to maintain adequate supplies, with the Ministry Secretary writing to the companies to ensure there is no market disruption.
The Government’s powers, however, are limited. Under the agreements, it can issue a general notice requiring the companies to maintain minimum stocks and the minimum fuel supply the country needs to function, and can intervene if they curtail the volume of fuel imported. It cannot direct individual companies on distribution to particular filling stations.
Referring to four agreements, the most recent signed in 2022, the Minister said none contained provisions allowing the Government to intervene when a supplier refused to provide fuel to a particular filling station or area.
The agreements also allow the companies to set their own selling prices based on the fuel pricing formula, though private suppliers have generally chosen to match prices set by the CPC, he said.
