Editorial : Some little known facts behind the fuel crisis

28 February 2013 08:01 pm - 1     - {{hitsCtrl.values.hits}}

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Our Editorial on Monday highlighted the impact of last Saturday’s increase in fuel prices on the suffering population of our country. The reason given for this increase was supposedly due to the increased cost of crude oil which we were importing from Iran. Sri Lanka was earlier  importing most of its crude oil from Iran but this was stopped after the United States imposed economic sanctions on Iran because it is allegedly developing nuclear weapons.

The Ceylon Petroleum Corporation (CPC) in increasing the fuel prices claimed the cost of crude oil in the world market was about US$ 113 a barrel. The anomaly in this claim is that the CPC was quoting the price of Brent Crude which is not connected to the actual cost of the crude oil we buy from Saudi Arabia and other sources. That crude oil is classified as West Texas Intermediate (WTI) which this week was priced at US$ 93 a barrel. It has often been the policy of the CPC to quote Brent Crude prices apparently to delude the public when we are buying most of our stocks from Saudi Arabia and other sources whose prices are tied to the WTI Crude level which is usually around US$ 20 below the Brent prices.

We hope the new Petroleum Minister will take action to stop the gross errors or frauds like the import of contaminated fuel in 2011 and 2012. This fuel had fine dust particles which resulted from the residue of sand storms which are only too common in the desert region. This contaminated fuel clogged the pumps of vehicles and pumps had to be replaced at a high cost.

What is not commonly known by motorists is that replacement of fuel pumps alone is not sufficient as this fine dust which is highly abrasive wears down the injector nozzles of EFI engines, resulting in a sudden increase in fuel consumption by up to 40%. Thus it involves the replacement of the injectors which cost around Rs 15,000 each.

This problem reached grave proportions when fishing vessels discovered that their engines failed mid sea about 500 kilometres from land and had to be towed back if there were other vessels nearby. It must be known that a multi-day fishing trawler carries more than 20 barrels of fuel with 20 metric tons of ice and the loss on an aborted trip could be about one million rupees.

Another serious racket that is being flagrantly carried out in some fuel stations is to rig their meters to give short measure, thereby adding to the cost of fuel to the long suffering motorist. The CPC needs to carry out surprise checks on a regular basis as it is indeed a serious crime to increase the cost of fuel and to also supply it in short measure.
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See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

 

 
  • Muthu Friday, 01 March 2013 02:02 AM

    One missing thing is the hedging fiasco authored by a fast bowler.


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