US gets tough with Lanka over Iran oil
The United States has rejected Sri Lanka’s plea for exemption from the oil embargo on Iran and has asked the Government to dissociate itself from some 30 companies, including banks and shipping firms.
The Sri Lankan Government’s request had been prompted by rising costs to import refined fuel products.
The list of companies which the US wants the Government not to have dealings with are those blacklisted by the US for violating the oil embargo.
The Prime Minister’s Secretary S. Amarasekara, who is also the acting Chairman of the Ceylon Petroleum Corporation (CPC), told the Sunday Times that at a meeting with US officials, Petroleum Industry Minister Anura Priyadharshana Yapa had sought some concessions for Sri Lanka to overcome the effects of the sanctions on Iran, but the request had been turned down.
He said that the request was made on the grounds that Sri Lanka’s oil import bill was on the rise due to the sanctions as the Iranian light crude oil which suited the Sapugaskanda refinery was no longer available.
“We are now importing fuel from Abu Dhabi and Oman and blending them to suit the machinery at the Sapugaskanda refinery. This is an expensive method. As a result the fuel bill is on the increase,” he said.
Mr. Amarasekera said the shortfall was met with imports of refined products.
Meanwhile Petroleum Ministry Secretary R.H.S. Samaratunga said Sri Lanka had denied allegations that it was dealing with companies, shippers and agencies involved in fuel transactions with Iran in violation of the embargo.
Late last year, the US expressed concerns over Iranian oil procurements by Sri Lanka through third parties, thus flouting sanctions imposed by Washington. The concerns were conveyed to President Mahinda Rajapaksa by US Ambassador Michele Sisson.
The protest prompted the Sri Lankan Government to go into a long-term deal with a Singapore firm to import refined petroleum products till June this year.
The CPC has selected Swiss Singapore Overseas Enterprises (Pvt.) Ltd. to supply more than 2.4 million barrels a month. The company was one of six which responded to a tender in June last year to supply fuel to Sri Lanka.