STO (State Trading Organization) has renewed its agreement to supply fuel to MACL (Maldives Airports Company Limited) after hiking the price of fuel. The agreement was signed on behalf of the company by the new Managing Director Abdulla Saeed at a ceremony held at the STO Head Office yesterday. MACL was signed by Managing Director Mahjoob Shujau.
Under the renewed agreement, STO will supply MACL with 1.5 million barrel jet fuels and 88,000 barrel diesel in a year. STO MD Saeed said the agreement was renewed after the government revised the fuel supply rates due to the change in prices in the oil market. He added that the price revision was necessitated by rising oil prices in the global market, which has been affected by the Russia-Ukraine war since last year.
Although STO has confirmed that it will sell oil to MACL at a higher rate than the previous rate, it did not disclose the price hike. However, the move to hike fuel prices is seen as a necessary measure for STO to ensure its own financial stability amid a volatile global oil market.
The agreement between STO and MACL is important for the Maldives as it ensures the steady supply of fuel to the country's airports. The Maldives heavily relies on its tourism industry, and any disruptions to air travel could have significant economic impacts.
Overall, the renewed agreement between STO and MACL is a positive development for the Maldives, as it ensures the continued supply of fuel to the country's airports. While the price hike may lead to some short-term concerns, it is a necessary measure to ensure the financial stability of STO, which is crucial for the Maldives' economy.