Bangladesh Energy Regulatory Commission (BERC) on Sunday adjusted upward the price of a standard 12 kilogram (kg) LPG cylinder to Tk 1,306 from Tk 1,253 in the backdrop of an unusual hike in the energy prices at the consumers' levels.
The 4.23 per cent or Tk 53 increase in the LPG prices reflected changes in international contract prices set by Saudi Aramco.
The BERC's upward adjustment came at a time when Bangladesh was grappling with a fresh energy shock as the retail prices of liquefied petroleum gas (LPG) soared far above the government-fixed levels, driven by dwindling imports, global shipping disruptions and alleged market manipulation.
Across Dhaka and other cities, consumers reported paying Tk 1,800 to Tk 2,100 per cylinder, a staggering 50-70 percent above the official rate, as supply constraints and alleged market manipulation distort distribution.
Adviser of the Ministry of Power, Energy and Mineral Resources (MPEMR) Muhammad Fouzul Kabir Khan termed the crisis an 'artificial' one and assured that the crisis would ease within a week.
"We had a discussion with the LPG Operators Association of Bangladesh (LOAB) Sunday and they assured us of easing the crisis soon," he told the FE after the meeting with the LOAB leaders on Sunday.
"We also have asked the deputy commissioners (DCs) of every district to take necessary actions against the offenders," said the adviser.
Industry insiders, however, attribute the energy shortage to lower imports.
At present, Bangladesh relies on private operators for 99 per cent of its LPG supply, with only a marginal share coming from state-owned sources.
Meanwhile, the LOAB in a press statement on Sunday night stated that despite some bottlenecks including higher freight rate and soaring demand in the European market, the current LPG storage of the country is satisfactory.
The association also blamed retail sellers for the current unusual price hikes and demanded strong punishment against such acts.
They also demanded strengthening the government's monitoring system to ensure that fuel is sold at the BERC the government-fixed rate.
When contacted, the LOAB senior vice-president Humayun Rashid said: "Sanctions on around half a dozen shipping vessels, that used to deliver LPG to Bangladesh are now restricted due to international sanctions, and tighter global supply have disrupted the sellers' ability to supply LPG to Bangladesh in adequate volumes."
Bangladeshi businessmen import LPG on cost and freight (CFR) basis meaning the sellers arrange the LPG and its transportation, he said.
Mr Rashid alleged that the retail sellers were selling the LPG at much higher rate keeping the consumers at bay sensing a dearth of LPG supply in the domestic market.
He also expressed the hope that the crisis would be eased by January 10th.
On the other hand, the Ministry of Power, Energy and Mineral Resources (MPEMR) in a press release also stated that the country imported around 127,000 mt of LPG in December, which was 22,000 mt higher than November's import of 105,000 mt.
Consumer rights groups alleged that syndicates of businessmen, distributors and retailers are exploiting the crisis by withholding supply and inflating prices.
"The businessmen have attained windfall profits within a very short span of time through this syndicate," energy adviser of the Consumers association of Bangladesh (CAB) professor M Shamsul Alam alleged.
Meanwhile, the BERC Chairman Jalal Ahmed through a press briefing Sunday also raised the January pump price of auto-gas-LPG used in vehicles-by Tk 2.48 per litre to Tk 59.80 compared to Tk 57.32 last month.
This is the second consecutive occasion of LPG price hike after a seventh consecutive month of reductions.
The commission has been setting LPG prices for private operators within the first week of every month since April 2021.
Azizjst@yahoo.com
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