0520 GMT June 26, 2022
The South Asian- island nation has suffered months of dire shortages and protests, which turned deadly earlier in May with at least nine people killed, AFP reported.
Energy Minister Kanchana Wijesekera said a newly appointed "economic war cabinet" on Monday approved the new rates to stem huge losses at the state-run Ceylon Petroleum Corp.
The price of diesel, commonly used in public transport, was raised from 289 rupees ($0.80) to 400 rupees a litre, a 38-percent jump, while the cost of a litre of petrol was increased from 338 to 420 rupees.
Diesel prices have increased 230 percent and petrol has gone up 137 percent in the past six months.
Both are in short supply and motorists have to queue, sometimes for days, to fill up.
An acute foreign exchange shortage has also led to the widespread scarcity of food and medicines, with the public suffering lengthy electricity blackouts and high inflation.
Sri Lanka imposed a broad import ban in March 2020 to save foreign currency as dollar inflows slowed.
The pandemic compounded economic woes triggered by President Gotabaya Rajapaksa's drastic tax cuts in 2019.
Prime Minister Ranil Wickremesinghe took office this month after the violent protests forced the resignation of his predecessor Mahinda Rajapaksa, the brother of the president.
The country is still without a finance minister to conduct urgent bailout talks with the IMF.