COLOMBO, June 21: Grappling to control soaring oil prices, Minister for Petroleum A.H.M. Fowzy has warned that the Sri Lankan government would take over more than 150 petrol and diesel stations operated by Lanka Indian Oil Corporation (LIOC) if the company did not bring down the price of diesel to level with the state-owned Ceylon Petroleum Corporation (CPC).

Mr Fowzy told parliament that the government would be left with no alternative but to take over the operations of LIOC if the company continues operating on the sole principle of making profits.

The minister’s statement came after the LIOC increased the price of diesel by Rs24 a litre claiming it was forced to go for the hike after the government imposed a fresh levy of Lankan Rs24.50 a litre on imported petroleum products.

Lanka IOC, Indian Oil’s subsidiary in Sri Lanka, is the only private oil company other than the state-owned CPC that operates retail petrol and diesel stations in the country. It has been incorporated to carry out retail marketing of petroleum products, bulk supply to industrial consumers, building and operating storage facilities at the Trincomalee Tank farm.

Minister Fowzie’s threat to take over LIOC petrol stations comes as the government of President Mahinda Rajapakse began taking measures to combat the economic crisis in the country caused by skyrocketing oil prices. Among the steps taken is a Presidential directive to curtail expensive foreign trips by government ministers.