Global oil prices are falling thanks to the US-Iran peace deal. No sooner had US President Donald Trump and Iranian President Dr. Masoud Pezeshkian signed a framework for peace than some Opposition politicians in Sri Lanka began demanding fuel price reductions. The JVP-NPP government, which allegedly increased the prices of fuel stocks procured before the eruption of the West Asia conflict, has ignored the demand for fuel price decreases.

The JVP vehemently protested whenever fuel prices were increased during the previous governments, calling for measures, such as the abolition of petroleum taxes to bring fuel prices down. Its leaders even argued that there was no need for a government if local fuel prices were to be increased whenever global oil prices increased. Slashing fuel prices was one of the key election promises of the JVP/NPP. Now, the JVP-NPP government is under pressure to make good on its pledge.

There is much more to the fuel issue than high prices, and what is needed is a dispassionate appraisal of the situation. It is the prices of WTI and Brent benchmark futures that have decreased, and it will take some time for the oil prices to drop at the pump in many countries. Although the Hormuz Strait has been reopened, it will be weeks before international navigation through that chokepoint normalises, stabilising global oil and fertiliser markets.

There is no gainsaying that Sri Lankan consumers deserve relief and fuel prices should be reduced, but prudence demands that politicians stop playing politics with crucial economic issues, and cooperate to resolve them. The focus of the government and the Opposition must be on formulating a strategy to reduce the country’s dependence on fossil fuel, which accounts for about 20% of national import expenditure. Curtailing the national fuel bill is half the battle in easing the country’s chronic balance of payment pressures and shoring up foreign currency reserves. Populist slogans and politically-driven ad hoc remedies will not help resolve the fuel crisis.

A country that does not strategise to achieve energy security cannot achieve economic development; it remains vulnerable to shocks, both internal and external, as evident from Sri Lanka’s experience in 2022, when a foreign currency crisis almost crippled the power and energy sectors, triggering political upheavals. The possibility of the country experiencing a similar situation either under the current dispensation or under a future government cannot be ruled out. It was a close call when the Iran war escalated, with global oil prices soaring, a few weeks ago. The current Opposition ought not to make the mistake of deriving perverse pleasure from the incumbent government’s predicament, making Machiavellian promises and calling for relief measures that are not feasible. The fuel crisis is likely to worsen under a future government, perhaps to the extent of making its leaders head for the hills. Hence, it will be in the best interests of the government, the Opposition and the public for a national action plan to be formulated, with the participation of all stakeholders, to ease the country’s dependence on fuel imports.

What Sri Lanka desperately needs to reduce its fossil fuel dependence significantly is a diversified approach combining renewables, biofuel, electrification and energy efficiency. Some progress has been made in expanding solar and wind power, but much more remains to be done. Renewable energy, which provides a reliable hedge against volatile global fuel prices, should constitute the core of any long-term strategy. Once installed, solar panels and wind turbines produce electricity without requiring imported fuel, but renewable energy technologies involve substantial initial investment and this has stood in the way of the expansion of renewable energy production. The government must secure financing without creating unsustainable debt burdens. International climate funds, concessional loans, and public-private partnerships may help bridge this financing gap, according to renewable energy experts. There are other factors that need to be addressed urgently to ensure energy sustainability. They include grid modernisation and the installation of energy storage systems, promoting energy efficiency in households, industries and public institutions, electrifying transport through promotion of electric vehicles and public transport systems.

It is hoped that the government and the Opposition will stop fighting over fuel prices and address the serious issues that threaten the country’s energy security and economic stability.

Saturday 20th June, 2026

The Commission to Investigate Allegations of Bribery or Corruption (CIABOC) has netted another senior state official. It arrested the General Manager (GM) of Lanka Salt Ltd., Rathnayaka Mudiyanselage Gunaratne yesterday for allegedly having caused a loss of approximately Rs. 14.3 million to the state and provided an undue advantage to a supplier by procuring Laklunu packaging for the Hambantota Salt Company through a re-order process in breach of procurement procedures.

Such action against state officials is certainly welcome, and all those who have enriched themselves through illegal means and/or caused losses to the state must be brought to justice. After all, that is the raison d’etre of the CIABOC.

On Thursday, the Central Crime Investigation Bureau (CCIB) arrested Sugeeshwara Bandara, who served as former President Gotabaya Rajapaksa’s private secretary. The arrest was made in connection with an ongoing investigation into allegations that Bandara drew two salaries from state institutions and thereby misappropriated public funds. Investigations have reportedly revealed that Bandara, while being Rajapaksa’s private secretary, held the position of Project Director at the Presidential Secretariat during the same period. The CCIB made Bandara’s arrest as dramatic as possible, perhaps to send a political message to other Opposition activists. Produced before court, Bandara was remanded.

Investigations should be conducted into alleged offences and credible evidence ascertained before suspects are arrested. Sri Lanka police often do it the other way around; they begin investigations and evidence gathering only after arresting and even detaining suspects. This deplorable practice is not of recent origin. The police acted in a similar manner during previous governments, which were bent on suppressing democratic dissent. The incumbent government came to power, promising a radical departure from that rotten political culture, but there has been no change.

The high-octane performance of the CIABOC and the police is curiously absent in situations where suspects happen to be cronies of the powers that be. How the CIABOC handled former Energy Minister Kumara Jayakody’s corruption case may serve as an example. The police stand accused of trotting out lame excuses for not arresting three JVP stalwarts involved in a forgery case. If they had been Opposition politicians, the CCIB itself would have swooped on them.

According to charges against Jayakody, while serving as the Manager of the Procurement and Import Division of the Ceylon Fertiliser Company, he committed an offence of corruption in 2016. He allegedly caused a loss of Rs. 8,859,708 to the state by influencing a procurement process for the benefit of a private company.

The CIABOC, which goes hell for leather to arrest suspects like Lanka Salt GM Gunaratne baulked at arresting Jayakody and hauling him up before court. Jayakody obtained bail immediately after being indicted.

Is it that all are equal before the law but JVP/NPP members are ‘more equal’ than others? The Opposition insists that no action has been taken regarding its complaints against Jayakody over a fraudulent coal procurement that has caused staggering losses amounting to billions of rupees to the state and led to an increase in diesel imports to operate oil-fired power plants and compensate for the generation loss at Norochcholai. One may recall that former Ministers Nalin Fernando and Mahindananda Aluthgamage have been sentenced to rigorous imprisonment over losses suffered by the state due to irregularities in the procurement of carrom boards and checkers board in the run-up to the 2015 presidential election. Former North Central Province Chief Minister S. M. Ranjith and his secretary have been jailed for a fraud involving a fuel allowance.

It is our fervent hope that the CIABOC will become independent enough to treat members of the government and the Opposition equally.

Friday 19th June, 2026

US President Donald Trump has revealed what really compelled him to agree to stop the Iran war. After signing an interim peace agreement with Iran, on Wednesday, he defended his deal with Tehran, telling the media that he wanted to avoid an “economic catastrophe” that could have resulted if the Iran conflict had continued. Tycoons like Trump are known to prioritise economics over everything else, but reflected in his thinking is an emerging security paradigm in the modern world. Military might alone no longer determines the outcome of an armed conflict; economic factors also play a significant role in shaping it.

Washington may have ignored the adverse impact of its Iran war if the US had been free from knock-on economic effects. But oil prices went up sharply in the US, and disruptions to about 30% of global fertiliser supplies due to the closure of the Hormuz Strait prompted American farmers’ associations to issue dire warnings of possible food price increases and shortages. Securing the sinews of war was no walk in the park for Trump. The Pentagon informed the House Armed Services Committee, a few weeks ago, that the US had spent USD 25 billion on the Iran war by that time. But Democratic leaders and several leading economists believe that the actual cost of the conflict to the US economy could be between USD 630 billion and USD 1 trillion, according to an Al Jazeera report.

What one gathers from the trajectory of the Iran conflict is that having control over a strategic oil chokepoint could prove as effective as the so-called nuclear deterrent in an asymmetrical conflict. Iran may have failed to achieve its goal of enriching uranium to the extent of being able to realise its nuclear dream, but it succeeded in using the Hormuz Strait as a strategic lever to shift the conflict to the economic front. The US naval blockade aimed at coercing Iran into submission did not yield the desired results. Washington underestimated Iran’s military capability and resilience, and had to lift sanctions on Russian oil in a bid to calm the volatile world oil market, but without much success. Not even the release of global strategic oil reserves could help stabilise petroleum prices.

The reaction of the world oil market to the signing of the US-Iran peace agreement was immediate. Brent crude futures dropped to USD 77.96 a barrel while WTI fell to USD 74.96 a barrel, much to the relief of economies around the world. Stocks rallied amidst falling oil prices. One can only hope that the US-Iran peace agreement will reach fruition, with all stakeholders making a serious effort to ensure its success.

Israeli Prime Minister Benjamin Netanyahu has not taken kindly to the US-Iran peace deal. In February, he declared the Iran war a dream come true for him. He said he had been dreaming of attacking Iran for 40 years. The unexpected end to the conflict has shattered his political dream. He was obviously relying on attacks on Iran to shore up his electoral chances ahead of the parliamentary polls scheduled for October 2026. The upcoming Knesset election has been described in some quarters as one of the most contentious electoral contests in Israel’s recent history, as it is the first national election to take place since the “October 7 attacks” followed by Israel’s war with Hamas and Hezbollah and the Iran war. Netanyahu is also standing trial in three separate corruption cases, facing charges of bribery, fraud, and breach of trust. He has denied any wrongdoing. His ongoing trial has been delayed due to his security and diplomatic schedule.

Meanwhile, sharp oil price drops will surely benefit Sri Lanka, but they are bound to throw up new challenges. The JVP-NPP government is coming under increasing pressure to bring oil prices down and do away with the QR-based fuel rationing system. If it gives in, low prices and unrestricted sales will lead to steep increases in fuel consumption and the national oil import bill, which has jumped more than fivefold from USD 98 million in February 2026 to USD 522 million in May, according to President Anura Kumara Disanayake. How the government proposes to navigate this sensitive politico-economic issue remains to be seen.