Lubricants market heading for slippery battle

March, 12, 2014

There are signs of Sri Lanka’s lubricants market becoming a slippery battlefield after April this year.

While further widening the lubricant oil market in Sri Lanka, the Petroleum Industries Ministry is preparing to provide lubricant marketing opportunities to 15 or 20 more new companies from April this year.

Currently there are 13 companies marketing lubricants within Sri Lanka and some 20 more have applied for opportunities.

The ministry is preparing to finalise the technical evaluation procedures on these new companies by April and provide them to enter the market.

If the technical evaluations are satisfactory the ministry plans to provide all these companies with the lubricants marketing opportunities.

However, during a recent conference in Colombo, Senior Vice Chairman of Lanka India Oil Company (LIOC) Sauman Ganguly said that by Sri Lanka providing opportunities to so many companies to enter a small lubricants market in the island, these companies may find it hard to do business in the country.

Even India with a huge lubricants market has only about 25 lubricant companies, he pointed out.

Another argument he stressed on was that since Sri Lanka’s lubricants market does not have stricter controls low quality products could easily enter the market due to the competition among the companies.

Apart from this, there are only two companies engaged in the petroleum sector and less than 10 in the telecommunications sector, Ganguly further pointed out.