Saturday 18th April, 2026

Never a dull day in Sri Lanka. CEO of HSBC Georges Elhedery has caused quite a stir here by claiming that Sri Lanka paid as much as USD 286 per barrel of oil, far above the global benchmark prices. He said so during a recent investment forum in Hong Kong. “What worries me is not the headlines,” he is reported to have said, adding that buyers sourcing oil from the Middle East are currently paying between USD 140 and USD 150 per barrel, and the highest amount for oil he has come across is a staggering USD 286 per barrel paid by Sri Lanka.

Elhedery’s remarks galvanised the Opposition into action here, with its propagandists going into overdrive, blaming the government for paying so much for oil, and hinting at a corrupt deal. Chairman of the Ceylon Petroleum Corporation (CPC) D. J. Rajakaruna has denied buying crude oil at USD 286 per barrel.

Addressing the media yesterday, Rajakaruna produced documentary evidence to support his claim, asserting that the HSBC CEO’s statement had been distorted to mislead the public into believing that the CPC had purchased crude oil at USD 286 per barrel. Asked by a journalist whether any kind of oil had been purchased at that price, Rajakaruna answered in the affirmative. He said refined oil was sold on the basis of five-day price averages, and the CPC had no alternative but to pay the amounts determined accordingly. If a shipment of refined oil had arrived between the end of March and early April, the prices would have risen steeply to the levels at issue, and nobody would have been able to do anything about it, Rajakaruna said.

True, the HSBC CEO did not specify that the oil he was referring to was crude. Therefore, it is not fair to compare the prices of crude with those of refined oil purchased at the height of the Iran war. However, the fact remains that according to the HSBC CEO Sri Lanka paid the highest amount for (say refined) oil, and the question is why it opted to pay that much while other countries were paying less.

Rajakaruna says the CPC was desperate to replenish the country’s oil stocks to prevent an energy crisis and had to buy oil at higher prices. His argument sounds tenable. However, other developing countries faced the same problem, and why didn’t they pay as much as USD 286 per barrel of refined oil? Did the supplier set a higher price for the oil arbitrarily, earned unconscionable profits at the expense of the Sri Lankan public, and shared the ill-gotten gains with someone in authority? Anything is possible in this country. What would be the situation if the JVP/NPP were in the Opposition today?

The CPC has passed its legacy debts on to the public in the form of a loss-recovery levy on fuel, amounting to Rs. 50 a litre, and therefore the public has a right to know why the CPC paid as much as USD 238 for refined oil per barrel while other countries were paying less for oil.

An investigation must be conducted to ascertain whether the CPC paid more for some oil shipments that could have been obtained at lower prices, and whether anyone cut a corrupt deal and lined his pockets. It must also be found out what the global prices of refined oil were when the CPC opted to pay USD 238 per barrel.

Friday 17th April, 2026

Chinese Foreign Minister Wang Yi is reported to have told his Iranian counterpart, Abbas Araghchi, in a telephone conversation, that reopening the Strait of Hormuz is a unanimous demand from the international community. He has stressed that Iran’s sovereignty, security, and legitimate rights should be respected as a littoral state of the Strait of Hormuz, but the freedom of navigation and safety through the strait should be ensured. One cannot but agree with the Chinese Foreign Minister.

A prolonged closure of the Hormuz Strait will only aggravate global economic woes and therefore be counterproductive. Tehran has a lot to gain on the diplomatic front; even some staunch allies of the US have taken exception to US-Israeli military aggression against Iran. It ought to take the shifting dynamics of the conflict into consideration and change its strategy accordingly.

The Chinese Foreign Minister has rightly noted that the current situation has reached a critical juncture between war and peace and the window of peace is opening. Iran must seize this opportunity. Araghchi has informed Wang Yi that his country is willing to continue to seek a rational and realistic solution through peaceful negotiations. It is hoped that the fragile ceasefire will be extended, and Pakistan will be able to bring the warring sides to the negotiating table again and help work out a compromise formula.

The US has imposed a naval blockade on Iran, targeting ships that enter or leave the Iranian ports, especially though the Hormuz Strait, through which about 20% of world oil supply passes. It has already turned back several ships that sought to enter Iran. Ironically, the US is doing what it has condemned Iran for—restricting international navigation through the Hormuz Strait. With its naval blockade, Washington is likely to incur more international opprobrium. It still has no way of forcing Iran to allow all ships to sail through the strategic chokepoint freely. However, the US naval blockade is likely to have a crippling impact on Iranian oil exports. With both Iran and the US using the Strait of Hormuz as a strategic lever, the countries that have nothing to do with the conflict have to sail between Scylla and Charybdis in the Gulf region.

Some experts are of the view that the China-Iran railway will help mitigate the impact of the US naval blockade and counter Washington’s efforts to isolate China and Iran, but this option could give rise to unforeseen logical and geopolitical issues.

About one-third of global seaborne trade in fertiliser reportedly passes through the Strait of Hormuz. The Gulf countries are key producers of nitrogen fertilisers. They also manufacture about 20% of phosphate fertilisers and 25% of global Sulphur. Urea prices have increased by 25% in the US, and the American Farm Bureau Federation has written to President Donald Trump, warning that production shocks will threaten national food security. The situation is far worse in the developing world. Sri Lanka is running out of its fertiliser stocks, and farmers are up in arms. Máximo Torero, the Chief Economist of the Food and Agriculture Organization of the United Nations, has warned that the ongoing disruption to the Strait of Hormuz trade corridor has triggered “one of the most severe shocks to global commodity flows in recent years, with significant implications for food security, agricultural production, and global markets”.

Meanwhile, Sri Lanka is playing politics with its national energy conservation strategy amidst a global crisis while all other countries are strictly enforcing regulations in place to curtail fuel consumption. The suspension of the QR-based fuel quota system on account of the traditional New Year celebrations must have led to a huge increase in fuel consumption for non-essential purposes, as evident from the record revenue from the expressways. What should have been done was to increase the fuel quota instead of suspending the rationing system so that the public would be compelled to consume fuel sparingly during the festive season. The West Asian conflict is far from over, and the crisis management strategies must not be compromised.

It is said that when the people fear the government, there is tyranny, and when the government fears the people there is liberty. However, in a bid to retain its hold on power, a government that fears the people, tends to resort to draconian measures that are deleterious to civil liberties and democracy and could lead to tyranny. Among them is the misuse of Emergency regulations on some pretext or another. Sri Lanka has spent most of its post-Independence years under a state of Emergency.

The JVP-NPP government keeps on extending emergency regulations even though several months have passed since the landfall of Cyclone Ditwah, which warranted their imposition. It drew severe criticism for an initial delay in declaring a state of Emergency, which it now cannot do without for all intents and purposes. A staunch critic of Emergency and the Prevention of Terrorism Act (PTA), the JVP/NPP came to power, promising to abolish the PTA and use the Emergency regulations responsibly, but it has reneged on that pledge.

On Thursday, Parliament voted to extend the State of Emergency under the Public Security Ordinance. There were 137 ayes and 27 nays. Members of the SJB, the ITAK, the NDF, the SLPP and Jaffna District Independent MP Dr. Ramanathan Archchuna opposed the government motion seeking the extension of Emergency. A vote was held after ITAK MP Shanakiyan Rasamanickam called for division. Worryingly, only 165 MPs, including the Speaker, were present in the 225-member House at the time of voting. Where were the other 60 MPs? Among the absentees were 21 government MPs and 33 Opposition members, according to media reports. At least the Opposition, which called for a division on the motion, should have ensured that all its MPs were present in the House. So much for the commitment of the MPs to their legislative duties and functions. They often haul state employees over the coals for dereliction of duty. First of all, they should put their own house in order.

A state of Emergency is no doubt a legitimate constitutional tool, but it must be used responsibly and sparingly strictly in response to genuine crises. Its extension for political reasons risks undermining democratic institutions, civil liberties and, most of all, public trust in democratic governance.

The deplorable practice of keeping a country under Emergency regulations for extended periods leads to the weakening of democratic culture, public distrust in government, corruption, lack of transparency, the debilitation of civil society and media freedom, an authoritarian drift, and economic and social uncertainty. The misuse of Emergency regulations could create a climate of instability, driving investors away at a time when Sri Lanka is emerging from its worst-ever economic crisis and desperately seeking foreign direct investment to build its forex reserves.

Political leaders currently in the Opposition wax eloquent in Parliament on the ill-effects of a prolonged state of Emergency. But their parties cannot absolve themselves of the blame for the culture of Emergency; the UNP, the SLFP and the JVP are prominent among them. There have been numerous instances where Emergency regulations were invoked in this country. In 1953, a UNP government imposed an emergency rule to restore order during a countrywide hartal. The SLFP did so in 1958 to suppress communal riots. Thereafter, the UNP used Emergency regulations to suppress a Tamil civil disobedience campaign. The SLFP and its leftist allies started the practice of extending Emergency regulations to consolidate its power after crushing the JVP’s first uprising in 1971. The situation took a turn for the worse under the UNP governments after 1977, and the country was under a state of Emergency during the Eelam war, which ended in 2009. The main Tamil political parties backed the LTTE both in and outside Parliament. In the post-war period, an anti-Muslim riot, the Easter Sunday terror attacks, the beginning of the current economic crisis, a mass uprising and natural disasters also led to the imposition of Emergency regulations.

Emergency has been more abused than used in this country. The incumbent government is now emulating the SLFP, the UNP and the coalitions led by them where all bad practices are concerned, while pontificating on the virtues of good governance.