Colombo: Money crunch Sri Lanka The announcement was made on Sunday sending ministers to Russia and Qatar to try and secure cheap oil, a day after the government said it all but ran out of fuel.
Meanwhile the government closed non-essential state institutions for two weeks to save fuel, retaining only a skeleton staff to provide minimal services.
Energy Minister Kanchana Wijesekera said the two ministers would travel to Russia on Monday to discuss getting more oil after last month’s purchase of 90,000 tonnes of Siberian crude.
That shipment was arranged through Coral Energy, a Dubai-based intermediary, but politicians are urging officials to negotiate directly with President Vladimir Putin’s government.
“Two ministers are going to Russia and I will go to Qatar tomorrow to see if we can arrange concessional terms,” Wijesekera told reporters in Colombo.
Wijesekera had announced on Saturday that Sri Lanka had run out of petrol and diesel after indefinitely delaying several scheduled shipments for “banking” reasons.
Wijesekera apologized for the situation, saying the fuel stock was enough to meet the demand in less than two days and it was being reserved for essential services.
State-run Ceylon Petroleum Corporation on Sunday raised the price of diesel by 15 percent to Rs 460 ($1.27) and the price of petrol by 22 percent to Rs 550.
Since the start of the year, diesel prices have nearly quadrupled and gasoline nearly tripled.
Wijesekera said there would be an indefinite delay in getting the new consignment of oil and urged motorists not to queue until he introduces a token system for a limited number of vehicles per day.
The US embassy in Colombo said a delegation from the US Treasury and State Department meanwhile arrived to “explore the most effective ways for the US to support Sri Lankans in need”.
“As Sri Lankans face some of the greatest economic challenges in their history, our efforts to support economic growth and strengthen democratic institutions have never been more important,” US Ambassador Julie Chung said in a statement.
The delegation included US Deputy Assistant Secretary of Treasury Robert Kaproth for Asia and Kelly Keiderling, Deputy Assistant Secretary of State for South and Central Asia.
The embassy said it had committed $158.75 million in new financing over the past two weeks to help the Sri Lankan people.
The United Nations issued a flash appeal last week, according to which about 1.7 million residents are in need of “life-saving assistance”.
The United Nations said four out of five people in the country of 22 million have reduced their food intake due to severe shortages and galloping prices.
Prime Minister Ranil Wickremesinghe warned parliament on Wednesday that there were more difficulties on the way.
“Our economy has completely collapsed,” Wickremesinghe said. “Now we are facing a situation much more dire than just lack of fuel, gas, electricity and food.”
Unable to repay its $51 billion foreign debt, the government announced it was defaulting in April and was in talks with the International Monetary Fund for a possible bailout.
Sri Lanka’s official inflation stood at 45.3 per cent at the end of May, according to official data, but private economists put it at 128 per cent, the second highest in the world after Zimbabwe.
Meanwhile the government closed non-essential state institutions for two weeks to save fuel, retaining only a skeleton staff to provide minimal services.
Energy Minister Kanchana Wijesekera said the two ministers would travel to Russia on Monday to discuss getting more oil after last month’s purchase of 90,000 tonnes of Siberian crude.
That shipment was arranged through Coral Energy, a Dubai-based intermediary, but politicians are urging officials to negotiate directly with President Vladimir Putin’s government.
“Two ministers are going to Russia and I will go to Qatar tomorrow to see if we can arrange concessional terms,” Wijesekera told reporters in Colombo.
Wijesekera had announced on Saturday that Sri Lanka had run out of petrol and diesel after indefinitely delaying several scheduled shipments for “banking” reasons.
Wijesekera apologized for the situation, saying the fuel stock was enough to meet the demand in less than two days and it was being reserved for essential services.
State-run Ceylon Petroleum Corporation on Sunday raised the price of diesel by 15 percent to Rs 460 ($1.27) and the price of petrol by 22 percent to Rs 550.
Since the start of the year, diesel prices have nearly quadrupled and gasoline nearly tripled.
Wijesekera said there would be an indefinite delay in getting the new consignment of oil and urged motorists not to queue until he introduces a token system for a limited number of vehicles per day.
The US embassy in Colombo said a delegation from the US Treasury and State Department meanwhile arrived to “explore the most effective ways for the US to support Sri Lankans in need”.
“As Sri Lankans face some of the greatest economic challenges in their history, our efforts to support economic growth and strengthen democratic institutions have never been more important,” US Ambassador Julie Chung said in a statement.
The delegation included US Deputy Assistant Secretary of Treasury Robert Kaproth for Asia and Kelly Keiderling, Deputy Assistant Secretary of State for South and Central Asia.
The embassy said it had committed $158.75 million in new financing over the past two weeks to help the Sri Lankan people.
The United Nations issued a flash appeal last week, according to which about 1.7 million residents are in need of “life-saving assistance”.
The United Nations said four out of five people in the country of 22 million have reduced their food intake due to severe shortages and galloping prices.
Prime Minister Ranil Wickremesinghe warned parliament on Wednesday that there were more difficulties on the way.
“Our economy has completely collapsed,” Wickremesinghe said. “Now we are facing a situation much more dire than just lack of fuel, gas, electricity and food.”
Unable to repay its $51 billion foreign debt, the government announced it was defaulting in April and was in talks with the International Monetary Fund for a possible bailout.
Sri Lanka’s official inflation stood at 45.3 per cent at the end of May, according to official data, but private economists put it at 128 per cent, the second highest in the world after Zimbabwe.