Thrifty consumers going for options affects gas industry

Consumers are complaining that even though the price of gas cylinders has been reduced they still cannot afford to buy gas due to the high cost of living 

Pictures By Waruna Wanniarachchi

For over three months the local and international media have continuously reported on Sri Lanka’s endless queues and painted a picture of doom and gloom. Unfortunately, fuel, gas, and other endless lines formed to purchase essential items have become the new normal for Sri Lankans during the past few months. 

However, with the ousting of President Gotabaya Rajapaksa in one of the most potent historical movements in the Sri Lankan history, by the struggle (Aragalaya), current President Ranil Wickremesinghe has assumed power. 
Along with the swearing-in of Wickremesinghe as president, the queues that grabbed attention have been lessening. The distribution of fuel is done with the usage of a QR code. Thus, each member receives a weekly quota and the activities of fuel mafias have decreased considerably. Meanwhile, the distribution of cooking gas was also streamlined while prices of Litro gas domestic cylinders were revised. Accordingly, the price of the domestic cylinders was reduced as follows: 12.5kg by Rs. 246, 5kg by Rs.99 and 2.2Kg by Rs 45. 

Accordingly, the new price of a 12.5kg domestic cylinder is Rs. 4664, The new price of a 5kg cylinder is Rs. 1872 and the new price of a 2.2Kg is Rs. 869. 

In this background, the Daily Mirror toured the Colombo suburbs as the vast majority is worried because people think that they can no longer afford cooking gas cylinders despite the reduction in prices. 

Kumari Perera, 46, runs a small grocery shop to feed her two children. Sharing her misery with the Daily Mirror she said that she could no longer afford a gas cylinder; she has been using firewood for more than four months now. “Although it is said that there are plenty of gas cylinders when we go to buy, we will have to purchase from the black market. It is frequently said that the prices are reduced, but still, the price of a gas cylinder is around Rs. 5500. I was unable to find a gas cylinder for my mother’s alms-giving, so I could not perform the alms-giving rituals this year. We are extremely disappointed about the current situation,” she complained. 

She also added that even though the authorities occupying the top chairs are changed the misery of ordinary people is still the same. “We need a price reduction on essential goods. Otherwise, within no time, the vast majority would starve. We simply cannot spend Rs. 5000 to purchase a gas cylinder; eating Samaposha or boiling grains with firewood is the only solution that’s available,” she added. 

Ruwina Nilanthi, 53, says that six members of her family depend on her daughter as her husband is ill and cannot work. She says that purchasing a gas cylinder is a dream. “We cannot, in any way, think of buying a gas cylinder because we have to focus on finding the next meal and surviving. For about four months, we have been using firewood. I am exhausted after cooking, and cannot perform any other task other than cooking. Cooking with firewood requires a lot of energy as I have to blow air at regular intervals. At least if we had kerosene oil it would have made things easier, but there is no kerosene oil either. So we have to use paper and wood to ignite the fire. It is an arduous task,” she said. 

Nilanthi added that her entire family had no luck in tasting poultry or eggs for about two months due to the skyrocketing prices of food items. “I do not feel well most of the time. Affording a balanced food basket is an illusion in the current context. Availability or unavailability of gas is no longer our concern because we cannot afford it. We request the government to reduce the prices of all essential items. Our children are suffering without a proper meal,” she added. Nilanthi also said that it is ridiculous of the government to reduce the price of a gas cylinder by Rs. 246 while all the other prices of goods are skyrocketing. 

“We have sufficient stocks, but people do not buy gas now. It is understandable as people cannot afford to buy gas due to the price. What can people do with a reduction of Rs. 246 while the prices of all the other goods are soaring”
- Buddhika Proprietor 
Buddhika Enterprises

Dharmendra, a 58-year-old three-wheeler driver, said that gas distribution is now streamlined and that there are no queues. “However, people are not buying gas. Earlier, there were so many conflicts in gas queues, but now, the dealer is looking forward to selling the cylinders that people cannot afford. I only get 5 litres of fuel per week and I can undertake hires for only a day with that. This is my sole income, but for half of the week, I have to idle. Therefore, how is it possible for me to buy a gas cylinder which is nearly Rs. 5000?” he questioned.  
M. K. Kamala, 71, said that she survives with the Samurdhi payment as her husband is too old to provide for the family. She also added that as she lives in a flat cooking with firewood has been a disaster as all her walls are blackened. “I cannot afford a gas cylinder with the Samurdhi payment I receive, so I cook with firewood. Even to cook with that, we do not have kerosene oil. The price of a gas cylinder isn’t affordable to the vast majority of the citizens in the country. We request the government to provide us with kerosene oil; at least to survive. We are very poor. I do not care who sits in the top chairs. We only need a person who is capable of reducing the price of essential items,” said Kamala. 

Jayasekara, 70, a grocery store owner, said that it is useless to reduce the price of a gas cylinder by Rs. 200 when people cannot even afford a bus ticket in the current context. “We do not have business at all. Earlier, a packet of milk was Rs. 50, but now, it is Rs. 90. The price of a packet of Milo has gone up to Rs. 120. I feel heartbroken for the schoolchildren who turn away after inquiring about prices,” Jayasekara said. 

Chandrakumar, 46, who is a father of a five-year-old child, said that the government is playing tricks on the people while showing a different face on different days. “Although gas prices are reduced, the price of coconut oil and other goods has increased. I run a small shop, but it is extremely difficult to operate a business these days,” said Chandrakumar. 

He also added that if the electricity bills are also subject to a price hike, small-scale businessmen like him would have to close down the shop. “We will not be able to keep refrigerators switched on if the electricity bill prices are raised. Our profit is about Rs. 10 from a cool drink. In this background, we cannot keep refrigerators switched on. Our business will slowly collapse. Even now, we need a huge amount of money to purchase goods—which is unaffordable. The prices of groceries change on daily basis. Thus, we cannot have a steady business,” Chandrakumar added. 

Buddhika (34), the proprietor of Buddhika Enterprises, which is a dealer of Litro Gas, said that sales have drastically declined despite the reduction in prices. “We have sufficient stocks, but people do not buy gas now. It is understandable as people cannot afford to buy gas due to the price. What can people do with a reduction of Rs. 246 while the prices of all the other goods are soaring? The vast majority are using alternative cooking methods, so there is a drastic decline in sales,” he added. 

Laugfs Holdings Ltd Chairman W.K.H. Wegapitiya said that Laugfs has around 30% of the market share and given the circumstances it is impossible to comment on the supply and demand chain as it is subjected to constant changes.  

Litro Chairman Muditha Peiris speaking to Daily Mirror said that around 27.5 million dollars per month is needed to meet the demand for gas. “We need around 7 million dollars per week, so it is around 27.5 million dollars to 28 million dollars per month. Earlier 100,000 gas cylinders from 12.5 kg and 20,000 cylinders from 5kg and 2.5kg each were released to the market. But given the circumstances now, it has reduced to 80,000 per week from 12.5kg and 10,000 – 12,000 cylinders from 5kg and 2.5kg”, he added. 

“We have enough stocks till October 31 and shipments are also confirmed for the future. Furthermore, from November 23 we will have a new tender; it is currently in the finalizing stage and is expected to be completed by the end of this month” 
- Muditha Peiris 
Litro Chairman 

Peiris also added that with the recent price reduction, Litro gas expects a surge in demand but not a significant hike due to the current economic situation. “We have enough stocks till October 31 and shipments are also confirmed for the future. Furthermore, from November 23 we will have a new tender; it is currently in the finalizing stage and is expected to be completed by the end of this month. Therefore, we have enough stocks for the next 15 – 16 months,” he said. 

In addition he said that the authorities expect the frequency of refilling to decrease. “One reason is that consumers are now thrifty. Due to the past and present crises, consumers are now using alternative methods and are vigilant when using the gas cylinder in the most profitable way for longer use. Consumers are also facing hardships when coping with the new prices,” he underscored. 

Peiris also said that Litro Gas enjoys around 90% of the market share since Laugfs is not importing. Furthermore, he said that Litro is not importing new cylinders as their first responsibility is to fill the empty ones. Accordingly, only after around three months will Litro be importing new cylinders,” he added.