LNG crisis drives import costs up

Bangladesh's efforts to secure much-needed liquefied natural gas (LNG) have become increasingly difficult as global prices surge and long-term suppliers continue to suspend scheduled cargo deliveries, forcing the country to rely on significantly more expensive spot market imports.
The country managed to award only two spot LNG cargoes out of its last five procurement attempts after issuing tenders and re-tenders for deliveries within similar timeframes, as global suppliers quoted prices well above expectations, a senior official of state-run Petrobangla told The Financial Express.
To maintain the country's overall natural gas supply, Petrobangla purchased its latest spot LNG cargoes at US$22.35 per million British thermal units (MMBtu) from Vitol Asia Pte Ltd and $21.66 per MMBtu from BP Singapore Pte Ltd for delivery during the August 15-16 and August 2-3 windows, respectively.
Petrobangla will pay around $75 million to Vitol Asia and $73 million to BP Singapore for the two spot LNG cargoes, the official said.The latest purchases are around 34 per cent more expensive than Petrobangla's previous spot LNG procurement, when it bought a cargo from TotalEnergies Gas & Power Ltd for about $56 million for delivery during the July 26-27 window.
Sector insiders said volatility in global energy markets, coupled with the downgrade of Bangladesh's long-term sovereign credit outlook by S&P Global Ratings from stable to negative, may have contributed to the higher spot LNG prices.
They said Bangladesh could procure LNG at roughly half the current spot price if long-term suppliers such as QatarEnergy, OQ Trading of Oman, Excelerate Energy and Summit Oil & Shipping resumed deliveries under their contractual agreements.
Under the existing sales and purchase agreements (SPAs), Petrobangla would be able to buy LNG from these long-term suppliers at around US$11-12 per MMBtu, even at current market prices, market insiders said.
QatarEnergy, OQ Trading of Oman and Excelerate Energy have suspended LNG cargo deliveries after declaring force majeure following the outbreak of war in the Middle East.
Meanwhile, LNG deliveries by Summit Oil & Shipping remain suspended following the cancellation of its contracts during the previous interim government.
Sources said Summit Oil & Shipping has recently expressed its willingness to the BNP-led government to resume LNG supplies under the previously negotiated arrangements at an estimated delivered price of around US$11.5 per MMBtu.
The company is currently pursuing legal remedies over the matter, insiders said.
They added that Bangladesh could save billions of dollars if Summit's LNG supply agreement is reactivated, as the company did not declare force majeure.
As of July 31, 2026, Bangladesh had purchased 38 spot LNG cargoes this year to offset potential supply shortages after Middle East disruptions, particularly in the Strait of Hormuz, constrained contractual supplies.
The country imported a total of 49 spot LNG cargoes in 2025.
In addition to reduced contractual LNG supplies caused by the Middle East conflict, Bangladesh is also facing tighter gas availability following the sudden shutdown of one of its two floating storage and regasification units (FSRUs) on July 21.
According to official Petrobangla data, Bangladesh's overall natural gas supply fell to around 2,153 million cubic feet per day (mmcfd) on July 31, including 500 mmcfd of re-gasified LNG, down from the pre-incident level of 2,642 mmcfd.
Azizjst@yahoo.com