HARPING ON PRICE FORMULA IMMATERIAL NOW

Talking of fuel price formula was becoming immaterial as oil prices could go up to $ 90 a barrel in the near future as a result of the global economic crisis, Prime Minister Ranil Wickremesinghe told Parliament yesterday.

SAYS GLOBAL OIL PRICES CAN GO UP BY NOVEMBER WHEN US SANCTIONS ON IRAN TAKE EFFECT

Prime Minister Wickremesinghe, who was responding to a question raised by Chief Opposition Whip Anura Kumara Dissanayake in the House, said some countries believed that the price of oil could go up to $90 a barrel as a result of the global economic crisis.

“Some countries believe that the price of oil could go up to $90 a barrel by November, with the US economic sanctions on Iran,” he said.

“Such a price hike could take place if the stocks of oil that the market could lose as a result of the sanctions, cannot be filled by other means,” he said.

“I discussed this matter with the UK and Norway during my visit and they said things were uncertain.

“Therefore, what we should consider is how to face this global situation. We need to focus on this matter, not about price formula,” Mr Wickremesinghe said.

“What we should focus on is how to face the global economic issues and ensure concessions to people,” he added.

He said Sri Lanka could be affected by the trade war between China and the US as well.

Elaborating on the fuel formula he said it was introduced after receiving the Cabinet nod from May this year.

He said the unloading cost, operating cost, pipeline fees, the cost of fuel lost through evaporation, warehouse cost, and commissions given to sales agents, taxes were taken into consideration when deciding the price as per the formula.

The Premier said MOPS Rate (Mean of PLATTS) computed by PLATTS Organization Singapore, premium and Freight Onboard rate.

MOPS (short for the Mean of PLATTS Singapore) is the average of a set of Singapore-based oil product price assessments published by PLATTS, a global energy, petrochemicals, metals and agriculture information provider and a division of Mcgraw Hill Financial

“This Government reduced the prices as soon as it was elected. However the prices have increased due to global developments but the current prices are still less than the price, which prevailed prior to 2015,” he added.

This Government reduced the prices as soon as it was elected. However the prices have increased due to global developments but the current prices are still less than the price, which prevailed prior to 2015