Slight cut in fuel prices

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FE Report
The government has slashed the fuel prices again in the domestic market by Tk 2-4 a litre or 3.75 per cent to 5.12 per cent against the backdrop of a substantial fall of its prices in the international market, officials said Monday.
Prices of diesel and kerosene have been reduced by Tk 2.0 per litre to Tk 46 from the previous Tk 48, petrol by Tk 4.0 per litre to Tk 74 from the previous Tk 78 and octane by Tk 3.0 per litre to Tk 77 from its previous price of Tk 80 a litre.
Energy ministry officials said the revised petroleum prices came into effect from midnight Monday.
Crude oil prices were hovering around $43 per barrel in the international market Monday.
It came down to $34 a barrel, five-year record low, in the international market last week from a record high of $ 147 in July 2008.
With the Monday's cut the caretaker government slashed the domestic prices twice within the last two months.
In October 27, 2008 it slashed the fuel prices by Tk 7-10 per litre or 10.34 per cent to 12.73 per cent in line with the falling oil prices in the international market when it was hovering around $60 a barrel.
"Fuel prices have been reduced considering the downward trend in its prices in the international market," Chief Adviser's special assistant M Tamim told the FE Monday.
Helping the country's farmers in getting petroleum items at lower prices during the irrigation season is also a major reason for this downward price adjustment, he said.
The government at the same time would continue providing subsidy to the poor farmers against petroleum purchases, said Professor M Tamim.
A further adjustment to the domestic fuel prices is likely by late January in line with a current government provision to review the prices in every three months.
It has also decided in principle to adjust petroleum prices in the domestic market if its prices fluctuate at 10 per cent and above in the global market, he added.
Asked about its impact on transport fare Mr Tamim said the communication ministry has been requested to settle the issue of fixing transport fare in line with fuel price cut.
But the commuters fear they might not get the benefit of slashing of oil prices this time too like the previous occasions.
During the cut in oil prices in October last the government officially reduced the diesel-run bus fare by 7.0 paisas per kilometre. But the transport owners did not cut the transport fares.
The energy ministry had sought consent from the Bangladesh Energy Regulatory Commission (BERC) before the latest cut in domestic fuel prices.
"We gave the consent as any decrease in prices would be welcomed by consumers," BERC Chairman Ghulam Rahman told the FE.
The country imports around 3.65 million tonnes of crude and refined products annually.
Among the products 2.3 million tonnes are diesel, 500,000 tonnes are kerosene, 100,000 tonnes are petrol and octane and 250,000 tonnes are jet fuel.