No fuel price hike-Susil

22 July 2011 09:35 am Views - 3895

By Olindhi Jayasundere

Petroleum Minister Susil Premjayantha said today that the Ceylon Petroleum Corporation (CPC) will not increase fuel prices despite continuous requests by the Lanka Indian Oil Company (LIOC) for both parties to increase the price of petrol and diesel prices evenly.

“LIOC may increase its prices, if it can afford to at this time. That decision is there’s to make. However CPC will not,” Minister Premjayantha said. The Minister said that CPC, which was recently ordered to pay US $162 plus interest by a London court for an oil hedging deal and was in crisis for the sale of substandard petrol, is not in a position to increase its prices. The last increase in CPC prices was in April while LIOC increased its rates in March this year.

LIOC Managing Director, Suresh Kumar said the company needs to increase it prices as it is incurring heavy losses. He said however that LIOC has to maintain its prices in line with CPC prices in order to maintain market competition. “Therefore we are asking CPC to increase its petrol and diesel prices so that we can increase our as well,” he said.

He said the economy has grown by 8% due to an increase in commercial activity and that as a result the demand for fuel has risen as well. Therefore an increase in petrol and fuel is imperative, he said.

LIOC enjoys 25% of the petrol and diesel market share in the country while the rest of the majority is enjoyed by CPC. CPC and LIOC both sell a liter of petrol at Rs.125 while CPC sells a liter of diesel at Rs.76 and LIOC sells a liter of diesel at Rs.85. (Daily Mirror online)