Central Bank Governor Nandalal Weerasinghe has told parliament’s Committee on Public Finance that the Ceylon Petroleum Corporation’s petroleum import bill reached US$1 billion in just the first four months of 2026 — approaching last year’s full-year total in a third of the time — and identified it as the primary driver of the rupee’s recent depreciation.
Appearing before COPF on May 14, the Governor said CPC had already spent $1 billion on fuel imports between January and April, compared to $1.5 billion for the entirety of 2025. “The petroleum bill in the first four months itself has been $1 billion compared to the whole last year’s $1.5 billion only for CPC. So there is a larger demand for foreign exchange to buy petroleum,” Weerasinghe told the committee.
The pressure on the foreign exchange market is broader than CPC alone, the Governor noted, since the two private fuel retailers — Lanka IOC and Sinopec/Ceypetco — are simultaneously importing fuel and competing for the same pool of dollars.
Weerasinghe also cited slowing tourism receipts as a compounding factor. “The tourism also has slowed down. But the remittances are doing okay so far,” he said, adding that export growth had not kept pace with the surge in imports.
The rupee has fallen approximately 4.5 per cent against the US dollar through May 15, 2026. The Governor’s COPF appearance came four days after the exchange rate touched a record retail selling level of Rs. 332 per dollar.
The government’s three-month fuel subsidy of Rs. 57 billion, announced Sunday, is intended to absorb some of the import cost pressure on consumers — though it will add further strain to the Treasury’s foreign exchange outflow. Oil markets also remain elevated, with Brent crude hitting a two-week high above $110 following the drone strike on the UAE’s Barakah nuclear plant.
