Finance Ministry proposes weekly fuel price review

The Finance Ministry will recommend to the Cabinet a weekly review of fuel prices in keeping with price adjustments of oil in the international market, a senior Ministry official said.

The move follows the confusion on Friday after a fuel hike announced by the Ministry was overturned within 12 hours on a directive by President Maithripala Sirisena.

“We need to make the fuel price adjustments more regularly so that we can cut losses. The Treasury is overburdened by the fuel bill. Now that a fuel pricing formula has been introduced, it must be implemented,” he said.

A fuel price hike was announced on Thursday midnight only to be overturned on Friday morning. This was due to the lack of coordination between the Finance Ministry and the Ministry of Petroleum Resources Development, a Petroleum Ministry official said.

He said that price increases had to be announced by the Petroleum Ministry and not the Finance Ministry. “This is why we instructed the CPC not to effect the fuel price hike,” the official said.

The decision to increase the price of fuel had been taken by a Cabinet-appointed committee which comprises officials of the Treasury and the CPC but there had been some confusion on when the hike would be announced.

“The Finance Ministry announced it without informing us and hence this led to the confusion,” he said.

The Sunday Times learns that both President Sirisena and Prime Minister Ranil Wickremesinghe had been unaware of the fuel price hike till it was announced.

“The formula is important but we have to make sure it is implemented with all stakeholders being informed when the price adjustments are announced,” a government source said. The matter will be discussed at the Cabinet meeting on Tuesday.