LIOC fuels fresh price hike

• Price of Auto Diesel increased by Rs. 3, Petrol 92 by Rs. 7; second revision in less than two months
• Says move triggered by global spikes and SL revision is barest minimum taking into consideration impact on industry and people at large
• Claims despite hike still losing Rs. 42 per litre on diesel, Rs. 10 on petrol
• Writes to Finance and Energy ministries to provide relief to cushion loss
• LIOC ended first nine months of FY22 with a net profit of Rs. 1.44 b as against Rs. 91 m loss a year ago
• CPC yet to announce increase

LIOC has increased its retail selling prices for Diesel (Lanka Auto Diesel) by Rs. 3 per litre and Petrol (LP 92) by Rs. 7 per litre with immediate effect.

It said the move was due to huge increases in international prices on both products. 

“The losses are around Rs. 42 per litre on the sale of Diesel and Rs. 10 per litre on sale of Petrol at the current international prices,” LIOC said. 

“However, even after this price increase in Diesel and Petrol, LIOC will still have to bear significant losses at prevailing international prices for which it has been requesting the Finance Ministry and Energy Ministry to take necessary steps to provide relief,” LIOC added. 

State-owned Ceylon Petroleum Corporation (CPC) is yet to announce a similar hike. In October last year, LIOC implemented its own hike (by Rs. 5 per litre) though CPC didn’t follow suit. However CPC increased prices in December with Petrol 92 by Rs. 20 to Rs. 177 per litre, Petrol 95 by Rs. 23 to Rs. 207, auto diesel by Rs. 10 to Rs. 121 and Super Diesel by Rs. 15 to Rs. 159.

LIOC in its statement yesterday said since the last price revision (21 December) the Brent crude oil prices have increased from $ 72/barrel to $ 92/barrel in the international market. The unprecedented rise in international oil prices has breached the 7 year highs. 

As on date the international price of Gasoil and Gasoline 92 is exceeding $ 100/barrel. Oil prices are soaring due to geopolitical tension between the US and Russia over the Ukraine invasion, a deep freeze in Texas that disrupted some Permian oil production and failing of OPEC+ to address the growing gap between quotes and what is being produced.

LIOC Managing Director Manoj Gupta said the company has been left with no other option but to increase the prices of Petrol and Diesel. However, although losses are very high, presently the company has increased the prices to the barest minimum taking into consideration of its impact on the industry and people at large.

The selling price of Petrol and Diesel in the country remains significantly low as compared to the prices prevailing in the neighbouring countries. The prices of Petrol and Diesel need to be in line with the prices prevailing in the international market. 

Lanka IOC is the only public limited energy company and accountable to its more than 10,500 local shareholders.

Claims of loss on the sale of two fuel types, is despite LIOC finishing the first nine months ending 31 December 2021 with a net profit of Rs. 1.44 billion as against a Rs. 91 loss in the corresponding period.

Operating profit was Rs. 1.3 billion in comparison to a loss of Rs. 735 million. 

In the third quarter, net profit was Rs. 880.7 million, up from Rs. 6897 million a year ago. 

Retained earnings as at 31 December 2021 amounted to Rs. 13.3 billion, up from Rs. 12.3 billion as at end FY21.

Revenue in the first nine months rose to Rs. 60.5 from Rs. 46 billion whilst in 3Q it amounted to Rs. 23 billion as against Rs. 16.6 billion a year ago.