How is Sri Lanka planning to raise funds for fuel imports?

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Sri Lanka Seeks Funds for Fuel Imports Through Open Market and Supplier Negotiations

Sri Lanka is facing significant challenges in securing the necessary foreign currency to pay for essential fuel shipments, with the government planning to raise funds from the open market and negotiate more flexible payment terms with suppliers. The country requires approximately US$587 million to cover the cost of several fuel shipments, including two crude oil consignments, highlighting a severe dollar shortage that impacts its ability to import vital goods such as food, medicine, and fuel.
Open Market Fundraising Efforts

The government intends to explore avenues for raising funds within the open market to meet the immediate financial demands for fuel imports. This strategy aims to supplement the limited US$125 million that the central bank can currently allocate for new fuel shipments. The urgency is underscored by the need for US$316 million this week alone for new shipments, a figure that escalates to US$587 million if two crude oil shipments are included in the calculation.
Negotiating Flexible Payment Options

In addition to seeking funds from the open market, Sri Lanka is actively engaging with its suppliers to secure more accommodating payment arrangements. Discussions are ongoing to settle a substantial US$800 million owed to seven suppliers for purchases made earlier in the year. This proactive approach to renegotiate payment terms is crucial given the country's depleted foreign exchange reserves.
Current Fuel Stock Situation

The nation's fuel reserves are critically low, with only 12,774 tonnes of diesel and 4,061 tonnes of petrol available in government stocks. This precarious situation has already led to significant disruptions, including the closure of schools, a work-from-home directive for public employees, and the restriction of fuel supplies to essential services. A shipment of 40,000 tonnes of diesel from Coral Energy is anticipated around July 9, and a partial payment of US$49 million is due by Thursday for a second diesel shipment from Vitol.

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How is Sri Lanka planning to raise funds for fuel imports?

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