Sri Lanka purchases most of its crude oil from the Middle East (also known as West Asia). News about the war triggered the mass panic buying of fuel in Sri Lanka, which had previously suffered a fuel shortage amid the widespread and serious economic crisis of 2022.

The panic buying occurred despite the fact that the Ceylon Petroleum Corporation (CPC) had stated that the island had enough fuel stocked to last until the end of April. Since the start of the war, the price of fuel has risen by 33%.

To preserve fuel, on 15 March the government declared every Wednesday a national holiday for the public sector and schools. Making Monday or Friday a holiday would mean that the government offices would be closed for three days straight, which is why Wednesday was picked instead. (This measure was cancelled on 8 April, to allow essential services to continue without interruption.)

This allocates a weekly limit of 5 litres per motorcycle, 15 litres per car, 60 litres per bus and 200 litres per lorry. Vehicles where the last number on the licence plate is an odd number are allowed to buy fuel on odd-numbered dates while those with an even number are allowed to buy fuel on even-numbered dates.

The rising fuel costs increased the price of delivery services, taxis and buses. The price of bus tickets has increased by 12%, affecting one of the only modes of transport for people on lower incomes.

 

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An official from the Ministry of Energy stated that the increase in fuel prices was less than the price hike in the international market, effectively subsidising the cost of fuel for Sri Lankan citizens. He explained that if the price of fuel was increased to match the entire price hike, transportation would be too expensive, meaning that people would not be able to go to work and would lose their jobs.

Since the US loosened sanctions hindering other countries from buying Russian fuel, Sri Lanka reached an agreement with Russia to purchase its crude oil, and the first shipment is expected to arrive in mid April.

Meanwhile, Sri Lanka turned down the offer from Iran to supply the country with Iranian fuel, due to not having the proper means of transportation.

Sri Lanka imports about 60% of its total energy supply, most of which is transported through the Strait of Hormuz. Moreover, the country has no storage capacity beyond one month, as it has only three storage tanks across the whole island.

President Anura Kumara Dissanayaka told Parliament that Sri Lanka would be building six new storage tanks, as well as replacing two decommissioned oil tanks with new ones. This decision would add ten more days to the existing fuel storage capacity and would cost approximately 4.77 billion Sri Lankan rupees ($15mn).