June 15, Colombo (LNW): The Government is assessing the possibility of maintaining existing fuel prices even after the current fuel assistance programme comes to an end, provided international oil markets continue to show sustained stability and lower prices.
Officials say authorities are carefully tracking developments in global energy markets before making a final determination on whether state support for fuel pricing will be extended, revised or phased out in the coming months.
The fuel relief initiative, introduced earlier this year to cushion motorists and businesses from high fuel costs, currently provides concessions of Rs. 100 per litre on Lanka Auto Diesel and Rs. 20 per litre on Petrol. The programme was backed by a Rs. 57 billion allocation intended to ease pressure on household budgets and transport costs.
Although many consumers expected the subsidy scheme to conclude at the end of June, energy sector officials clarified that the programme is tied to the availability of the allocated funds rather than a specific calendar deadline. As a result, the concessions are expected to remain in place until the designated funding is fully utilised.
Ceylon Petroleum Corporation (CPC) Managing Director Mayura Neththikumara stated that the continuation of the subsidy beyond the current allocation will depend on policy decisions taken by the Government. He noted that the CPC is awaiting official guidance regarding the future direction of the relief programme.
According to industry officials, recent declines in global fuel prices have created a more favourable environment for domestic price stability. International diesel prices, which had previously surged amid geopolitical tensions and supply concerns, have shown signs of moderation, offering some relief to importing nations such as Sri Lanka.
Neththikumara explained that the recent fall in diesel prices on the world market could potentially allow local fuel rates to be maintained at present levels without requiring substantial additional subsidies. However, he stressed that policymakers would need to see a consistent trend rather than a temporary market correction before making long-term pricing decisions.
Energy analysts also caution that fuel pricing cannot be based on short-lived fluctuations. Global oil markets remain vulnerable to geopolitical developments, supply disruptions and shifts in demand, making sustained price stability a key factor in any future policy adjustments.
At present, retail fuel prices remain unchanged, with Lanka Petrol 92 Octane selling at Rs. 434 per litre and Lanka Auto Diesel at Rs. 407 per litre. Premium grades continue to be priced at Rs. 495 per litre for Lanka Petrol 95 Octane and Rs. 478 per litre for Lanka Super Diesel.
Officials indicated that if international fuel prices remain at current levels over an extended period, the Government may have greater flexibility to maintain affordable domestic fuel prices while reducing the financial burden of subsidies on the Treasury.
A final decision on the future of the fuel relief programme is expected after a comprehensive review of global market conditions, fiscal considerations and the remaining balance of the subsidy allocation.
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