Bankrupt Sri Lanka still seeking more oil and fuel imports

Bankrupt Sri Lanka is seeking more energy imports as it tries to get an International Monetary Fund Program in place by mid-June.

The South Asian nation is grappling with rampant inflation and shortages of everything from gasoline to food amid its worst economic crisis in a generation. It previously struggled to pay for shipments of crude and refined fuels that ended up sitting in tankers off its coast.

Sri Lanka is still looking for more fuel imports, Energy Minister Kanchana Wijesekera said on Twitter on Wednesday. Ceylon Petroleum Co. has issued tenders for crude and fuels such as diesel, gasoline, fuel oil and jet fuel on its website, to be delivered from as soon as May to July.

The refiner has shortlisted 39 of 67 proposals for fuel supply and has “communicated possible payment plans,” Wijesekera said on Twitter. At the same time, the government is still seeking support and credit lines from oil-producing countries, he said. 

The country’s call for more fuel imports is coming as global prices of gasoline and diesel surge on tight supplies. Sri Lanka has a line of credit from state-run Indian Oil Corp. and has recently received shipments from its neighbor. Whether it can pay for more energy cargoes may depend on how quickly it can access more funds from overseas. 

The government is seeking a loan of about $4 billion this year from the International Monetary Fund and creditors including China and Japan, to help pay for food and fuel, Prime Minister Ranil Wickremesinghe said Wednesday. The World Bank said this week that it would not offer new financing to the nation until “an adequate macroeconomic policy framework is in place”.

Sri Lanka subsidizes fuel costs to consumers and will be taking a loss on the imports. The amounts range from around 84 rupees ($0.23) a liter for 92-RON gasoline to as much as 275 rupees a liter for kerosene, according to a document Wijesekera posted on Twitter.