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Sri Lanka's energy crisis: A disaster of past actions
By Dinouk Colombage “Oil and gas have always been political commodities” – Daniel Yergin Sri Lanka’s energy sector is facing a growing crisis; a combination of governmental mismanagement, an absence of a clear energy policy and global tensions has brought the country to the brink of blackouts, which will accompany the recently announced energy price hikes (for both electricity and fuel). Global headlines have been dominated by the war in Iran, which was launched last month by the U.S. and Israel. The result has been steadily climbing global oil prices which has been mainly caused by the closure of the Strait of Hormuz by Iranian forces. Countries, especially in Asia, have resorted to enforcing fuel rationing measures which include the introduction of fuel quotas and mandatory work-from-home days for both the private and public sectors. In Sri Lanka the initial news of the joint U.S./Israel attacks on Iran led to widescale panic buying of fuel. Reminiscent of the 2022 economic crisis, queues were abundant at fueling stations around the country as motorists rushed to fill up in anticipation of shortages. Despite attempts by government officials to re-assure the people that the country has adequate fuel supplies, the citizenry remained unconvinced and the queues did not shorten. The result was over-purchasing leading to self-induced shortages in the country. Despite having witnessed recovery efforts from the Opposition benches during the 2022 economic crisis, the President and his cabinet waited two weeks before re-introducing the QR system which had been first implemented in 2022 to conserve fuel stocks. After several days of uncertainty and technical glitches, the system is now in full effect with motorists provided a weekly allocation of 25 litres. While the Sri Lankan public has acclimatised to the fuel conservation measures, the Sri Lankan government has announced efforts to expand the country’s fuel storage capabilities. Ironically, the country has resorted to the much talked about Trincomalee Oil Storage Tankers, a project that has been the subject of wide-scale opposition by the now ruling Janatha Vimukthi Peramuna (JVP). In the early 2000s the conversations with India over the joint development of these World War 2 era oil storage tankers did not proceed due to the war with the Tamil Tigers in the North and East of the country. Blind opposition In 2017, while the Sri Lankan government, led by the United National Party (UNP), was negotiating wi...
Fuel Crisis Twist: From Protests to Dependence on India -
A dramatic reversal unfolds as Sri Lanka’s leadership, once fiercely opposed to Indian energy deals, now turns to New Delhi for survival amid a worsening fuel crisis triggered by global conflict. Amid an escalating oil crisis driven by the Middle East war, President Anura Kumara Dissanayake held urgent discussions with Indian Prime Minister Narendra Modi as Sri Lanka once again grapples with fuel shortages and energy insecurity. Follow The Morning Telegraph WhatsApp Channel Get breaking updates, instant alerts, and exclusives. Join Now The situation echoes the economic collapse under Gotabaya Rajapaksa’s administration, when then Finance Minister Basil Rajapaksa travelled to India to secure a vital credit line that enabled Sri Lanka to import fuel and essential goods, ultimately bringing an end to crippling fuel queues across the country. This pattern reinforces a consistent reality in Sri Lanka’s energy crisis narrative. Whenever fuel shortages intensify, Colombo turns to India for immediate assistance. Recognizing this dependency, the Ranil Wickremesinghe government in 2003 moved to lease 15 oil tanks in Trincomalee to India under the framework of the Indo Sri Lanka Agreement of 1987. However, the decision triggered fierce political backlash, with the SLFP and JVP leading nationwide protests, accusing the government of compromising national assets. The resulting political pressure derailed the agreement and stalled progress. By 2004, political upheaval further disrupted continuity when President Chandrika Kumaratunga aligned with the JVP and dissolved Ranil Wickremesinghe’s government, effectively halting any advancement of the Trincomalee oil tank development project. A decade later, in 2015, the Sirisena Ranil administration attempted to revive the initiative by proposing a joint venture between India and Sri Lanka to develop 85 unused oil tanks in Trincomalee. Once again, strong resistance emerged, led by the JVP, which organized protests claiming that strategic national resources were being handed over to India. Anura Kumara Dissanayake himself publicly opposed the move, raising concerns over sovereignty and control. In a parliamentary statement in 2018, Anura Kumara Dissanayake criticized the decision to involve the Indian Oil Company, arguing that the Ceylon Petroleum Corporation possessed the financial capacity and strategic advantage to independently develop the tank farm. He emphasized that such development could have strengthened Sri Lan...
Sri Lanka's economic crisis deepens amid war and cyclone fallout
President Anura Kumara Dissanayake has imposed fuel rationing, raised fuel prices by a third, and increased electricity costs by up to 40% since the conflict began disrupting global energy supplies.
Sri Lanka struggles to avert economic collapse over Mideast war
President Anura Kumara Dissanayake has rationed fuel, raised its price by a third and increased electricity costs by up to 40 percent since the war in the Middle East began.
