Recent fuel price hike based on fuel pricing formula, says CPC

The recent increase in fuel prices in Sri Lanka has been implemented strictly according to the official fuel pricing formula, Dr. Mayura Neththikumarage, the Managing Director of the Ceylon Petroleum Corporation (CPC) emphasized.

The CPC Managing Director explained that the government covers certain costs, but the revision in fuel prices itself follows a transparent formula. “This is not an arbitrary calculation,” he said. “The formula simply accounts for the cost of procuring fuel and related expenses. Nothing extra is added beyond these costs.”

Addressing a media briefing at the Department of Government Information, Mayura Neththikumarage clarified that while the government may subsidize a portion of the cost, the CPC’s responsibility is to calculate the price strictly based on procurement costs and operational expenses. These figures are then submitted to the government, which makes the final decision on retail prices. “The Corporation only presents the costs; no other factors are included in the formula,” the CPC Managing Director Mayura Neththikumarage said.

Traditionally, the formula is calculated once a month, based on the fuel stocks procured in that period, rather than on monthly averages. “Within a single month, there is usually no significant change in the standard price, which is why it is recalculated monthly,” Neththikumara noted. However, with global oil prices fluctuating rapidly, the calculation schedule has been adjusted to respond more effectively to market changes.

According to the Managing Director, the first price increase this month was implemented on the 1st, following the standard monthly procedure. A subsequent adjustment occurred on the 9th, after the escalation of the ongoing conflict, reflecting the price fluctuation between the 28th of last month and the 9th of this month.

Mayura Neththikumarage stressed that the Ceylon Petroleum Corporation remains committed to transparency, ensuring that all revisions are made strictly according to the established pricing formula, balancing procurement costs with government subsidies and market realities.