With no fuel and no cash, Sri Lanka grinds to a halt

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With no fuel and no cash, Sri Lanka grinds to a halt

Less than a day’s worth of fuel remains, says the energy minister, as the cash-strapped nation extends school closures.

Sri Lanka has less than a day’s worth of fuel left, the energy minister says, with public transport grinding to a halt as the country’s economic crisis deepens.

Power and energy minister Kanchana Wijesekera on Sunday said petrol reserves were about 4,000 tonnes, just below one day’s worth of consumption, as queues snaked through the main city of Colombo for kilometres.

The cash-strapped nation on Sunday extended school closures because there is not enough fuel for teachers and parents to get children to classrooms, with most pumping stations being without fuel for days.

Sri Lankan Prime Minister Ranil Wickremesinghe told Al Jazeera last week the petrol shortage will last until July 22 when the next oil shipment is expected. He said a gas deal has been secured which will ensure supplies for the next four months.

“It [fuel shortage] is a big setback to the economy and has caused lot of hardship to people. When we came in, the shortage of dollars actually contributed to this situation. We have been taking steps since then especially to get gas which will be available in the next few days, diesel and furnace oil as well,” he said.

“The issue has been petrol … and that will take a bit of time. We are hoping to get shipment of petrol by July 22 but I have asked the [concerned] minister to try to get the shipment earlier.”

‘Huge challenge’

Wijesekera told reporters on Sunday the government has ordered new fuel stocks and the first ship with 40,000 metric tonnes of diesel is expected to arrive on Friday.

The minister said the main problem is the lack of dollars and appealed to some two million Sri Lankans working abroad to send their foreign exchange earnings home through banks instead of informal channels. He said workers’ remittances, which usually stood at $600m per month, had declined to $318m in June.

“Finding money is a challenge. It’s a huge challenge,” he said.

Last week, Sri Lanka announced a two-week halt to all fuel sales except for essential services to save petrol and diesel for emergencies.

Local media reported there had been sporadic clashes outside fuel stations. Last week, troops opened fire to disperse a mob protesting against the military jumping the queue.

The economic meltdown has triggered a political crisis with widespread anti-government protests erupting across the country. Protesters have blocked main roads to demand gas and fuel, and television stations showed people in some areas fighting over limited stocks.

In Colombo, protesters have been occupying the entrance to the president’s office for more than two months to demand President Gotabaya Rajapaksa’s resignation.

They accuse him and his powerful family, including several siblings who hold top government positions, of plunging the country into the crisis through corruption and misrule.

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A shortage of foreign currency to finance even the most essential imports has led to the country’s worst economic crisis, with its 22 million people facing severe hardships daily.

The country has also faced record-high inflation and lengthy power blackouts since late last year.

All non-essential government institutions and schools have been ordered shut until July 10 to reduce commuting and save energy.

Authorities also announced countrywide power cuts of up to three hours a day from Monday because they cannot supply enough fuel to power generating stations.

Sri Lanka has has been getting most of its fuel needs from neighbouring India, which provided it with a credit line.

“We are buying fuel either using Indian credit lines and the foreign exchanges that we get from remittances. It [remittances] is a small amount, but nevertheless, sometime we get a billion dollar or a billion and a half. The rest of the reserves from what we got from creditors have already been busted,” Wickremesinghe told Al Jazeera.

The government said it was also negotiating with fuel suppliers in Russia and Malaysia.

The International Monetary Fund (IMF) will continue to hold talks with Sri Lanka for a possible $3bn bailout package, the global lender said last week, after wrapping up a 10-day visit to Colombo.

However, an immediate release of funds from the IMF is unlikely because the country has first to get its debt on to a sustainable path.

Source: Al Jazeera

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