Sri Lanka's state-run Ceylon Petroleum Corporation (CPC) spent $648.7 million on oil imports during the first four months of 2024, a significant decrease from the $828.4 million spent in the same period last year, according to a Finance Ministry report.
This reduction is attributed to the entry of new players in the market.
CPC's turnover fell to 389.1 billion rupees by the end of April 2024, marking a 16.6 percent decrease from the previous year's figures.
Meanwhile, the cost of sales declined by 13.5 percent, reaching 337.4 billion rupees compared to 390.1 billion rupees the previous year.
Despite the drop in turnover, CPC maintained a profit of 13.6 billion rupees through a pricing formula, though this is a 68.7 percent decrease from the 43.4 billion rupees recorded in the previous year. Trade payables also saw a reduction, falling to 153 billion rupees from 181.2 billion rupees.
Crude oil prices rose to approximately $89 per barrel by the end of April 2024, up from $77 per barrel at the end of 2023. CPC's financial stability has improved as the corporation no longer holds a loan with the Bank of Ceylon, the report noted.
Historically, CPC had been directed to take loans from state banks to finance oil imports, especially during times when the central bank printed money to reduce policy rates.
In addition, CPC still owes $201 million to the National Iranian Oil Company, a debt that dates back to a currency crisis in 2000, when the practice of borrowing for oil imports was initiated by government macroeconomists.
