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Air ticket prices go up 25-27 percent as rupee depreciates further
ECONOMYNEXT – Sri Lanka outbound travellers will need to pay 25- 27 percent more when booking airline tickets as the rupee continues to depreciate against dollar, the Civil Aviation Authority (CAA) said.
With the Central Bank of Sri Lanka (CBSL) deciding to let the rupee float, it depreciated further against the dollar as was quoted at 265/275 on Friday (11).
The devaluation of the rupee has affected multiple industries, and most fast moving consumer goods have increased prices overnight due to the increased cost.
“This is the same as what happened to fuel and other products, due to the effect of devaluation, the prices will increase 25-27 percent when booking airline tickets,” CAA Chairman Upul Dharmadasa told EconomyNext on Friday.
Even though international prices in the dollar rate are stable, Sri Lanka’s outbound travellers will need to pay up to 27 more than the previous price due to devaluation.
“This will affect all airline prices,” Dharmadasa said.
Confirming the price increase in airline tickets, Chairman of Sri Lankan Airlines Ashoka Pathirage told Economy Next that the airline has increased their prices by 27 percent from March 11 onwards.
“Every business will have to increase their prices due to the current situation of the currency,” Pathirage said.
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Fuel crunch looms
Govt. tells fuel distributors to maintain stocks to ensure uninterrupted supplies
by Saman Indrajith and Norman Palihawadane
The government had instructed private fuel distributors to maintain minimum stocks and ensure uninterrupted supplies to the market, Energy Minister Anura Karunathilaka told Parliament yesterday (06).
Karunathilaka said the Ministry of Energy Secretary had notified the relevant companies of the requirement, following a reduction in supplies by some private distributors, amid higher international fuel prices.
The Minister said private companies had informed the government that they were facing losses because international prices had risen while fuel was being sold, locally, at prevailing prices. As a result, some companies had reduced the volumes released to the market.
The reduced supplies had increased the burden on the Ceylon Petroleum Corporation (CPC), whose share of the diesel market had risen from about 54% to 82%, the Minister said.
“The CPC currently holds an 82% share of the market,” he said, adding that it had increased its supplies, compared with February, to compensate for the reduction by private distributors.
Karunathilaka said the government could not, under the existing agreements with private companies, specify the quantities they should supply to individual filling stations. However, it could require them to maintain minimum stocks in the country.
The Minister said the Energy Ministry had already instructed companies that had failed to maintain the required stocks to take steps to prevent supply disruptions.
The Minister attributed the queues reported at some filling stations to reduced supplies from private distributors, as well as normal variations in fuel distribution. He also said demand for CPC fuel had increased because private companies generally did not provide fuel to dealers on credit, while the CPC offered a three-day credit facility.
“We expect that, as the Ceylon Petroleum Corporation takes on this additional burden, the problem will ease to some extent by Wednesday or Thursday,” Karunathilaka said.
He said instructions had also been issued to increase supplies to CPC filling stations. A special discussion on the issue is scheduled for today (07), with officials of the Energy Ministry and CPC expected to participate,
along with President Anura Kumara Dissanayake.
Meanwhile, Petroleum Dealers’ Association officials have called for an early solution to the supply issue. Association Chairman D.V. Shantha Silva said queues had been reported at many filling stations, mainly those operated by private distributors.
He said the situation was not due to an overall shortage of fuel, but was linked to reduced orders by Lanka IOC, Sinopec and R.M. Parks amid concerns over losses incurred on fuel sales.
The Ceylon Petroleum Private Tanker Owners Association has urged motorists to refrain from panic buying, saying there was no nationwide disruption to fuel supplies.
The government earlier increased fuel prices and introduced a per-litre diesel subsidy following concerns raised by distributors over rising international prices.
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