Colombo, Apr 15 (EFE).- Sri Lanka’s state-owned Ceylon Petroleum Corporation (CPC) on Friday limited the supply of fuel with immediate effect as strong demand from motorists amid restricted fuel imports in the face of a severe shortage of dollars led to long queues at gas stations in the country.
“We are doing this to increase our efficiency in distributing fuel. What we have seen in the past is long queues for fuel which have inconvenienced many people on the roads,” CPC Chairman Sumith Wijesinghe told EFE, adding that it will only “be for a few days.”
From 1 pm on Friday, motorcyclists will only be allowed to purchase a maximum of 1,000 Sri Lankan rupees ($3) worth of petrol (less than 4 liters) while three-wheelers will be given up to 1,500 Sri Lankan rupees worth of fuel (petrol or diesel) and cars, vans, and jeeps up to 5,000 Sri Lankan rupees, the CPC chairman said.
The restrictions do not apply to buses, trucks and other commercial vehicles.
The move comes three days after Sri Lanka announced a pre-emptive default on all its foreign loans due to insufficient dollar reserves for repayment.
Finance Minister Ali Sabry, ministry officials and Central Bank officials are expected to begin talks with the International Monetary Fund on Monday for a loan to manage the balance of payment crisis.
Sri Lanka has been facing a fuel shortage since February, when the government ran out of dollars to finance fuel imports.
The fuel shortage has already led the government to impose extended power cuts, sometimes up to 13 hours per day.
The island nation was handed temporary relief with a $500 million credit line from India to fund fuel purchases in mid March.
However, government sources have told EFE that the loan is almost exhausted.
Earlier this week, Wijesinghe told EFE that the CPC is holding talks with India for another $500 million credit line and looking at a number of other fuel credit proposals to manage the situation over the next few months.
Analysts said the move could be aimed at cracking down on an emerging black market for fuel.
“Still, the fuel is subsidized and cheap. So they may want to stop the black market,” JB Securities brokerage firm CEO Murtaza Jafferjee told EFE.