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Crippling Energy Crisis Set to Worsen for Debt-Ridden South Asia

  • Oil traders shun sales to Pakistan, Sri Lanka on payment fears
  • Some sellers want upfront payments while banks stop financing
Lines of empty cooking gas cylinders surround the Galle International Cricket Stadium in Galle, Sri Lanka, in June.

Lines of empty cooking gas cylinders surround the Galle International Cricket Stadium in Galle, Sri Lanka, in June.

Photographer: Buddhika Weerasinghe/Bloomberg

An unprecedented energy crisis that’s gripping some of the most densely-populated and impoverished parts of South Asia may soon worsen as more fuel suppliers avoid selling oil to these nations. 

Fewer companies are offering to sell fuel to state-owned Pakistan State Oil Co, while some banks have stopped financing and facilitating payments for energy imports. Sri Lanka is also struggling to secure fuel from its regular supplier India. Meanwhile, Bangladesh is having to schedule power cuts to preserve its fuel reserves.