Fuel prices jump Tk 20 a litre

The government has raised the prices of diesel, kerosene, octane and petrol by Tk 20 a litre, with the new rates taking effect on Monday.

Diesel will cost Tk 135 a litre, kerosene Tk 155, octane Tk 165 and petrol Tk 160.

The Energy and Mineral Resources Division announced the new rates in a gazette on Sunday, while the Ministry of Power, Energy and Mineral Resources issued a statement explaining the increase.

The previous prices were Tk 115 for diesel, Tk 135 for kerosene, Tk 145 for octane, and Tk 140 for petrol.

The ministry said the ongoing war in West Asia had driven up global fuel prices and transportation costs significantly since March. Although international prices had more than doubled, it said Bangladesh had not raised domestic prices at the same rate.

According to the ministry, Bangladesh Petroleum Corporation (BPC) suffered losses of about Tk 230 billion between March and August. At current global prices, BPC is losing about Tk 89 on every litre of diesel, or roughly Tk 1.09 billion a day.

At that rate, the annual loss on diesel alone would reach about Tk 400 billion.

The government expects the Tk 20 increase to cut BPC’s annual losses by about Tk 100 billion.

The ministry also cited price differences with other countries and the risk of fuel smuggling.

Diesel costs Tk 134.76 a litre in Kolkata, Tk 164.83 in Myanmar, Tk 161.24 in Nepal and Tk 179.42 in Sri Lanka.

The prices are Tk 151.22 in Thailand, Tk 137 in Vietnam, Tk 140.71 in the Maldives, Tk 168.53 in the Philippines, Tk 185.48 in Pakistan and Tk 144.79 in the UAE.

Subsidies in the LNG sector and social protection spending were also cited.

The gazette sets post-tax ex-refinery prices at Tk 123.58 for diesel, Tk 143.78 for kerosene, Tk 149.78 for octane, and Tk 144.99 for petrol.

VAT, duties, marketing margins, transport funds and BPC’s development fund are added to determine the prices.

Dealer and agent commissions are Tk 3.71 for diesel, Tk 3.02 for kerosene, Tk 6.72 for octane and Tk 6.61 for petrol.

The ministry said diesel was last raised by Tk 15 to Tk 115 on Apr 18, while prices remained unchanged for five months despite global increases.

However, kerosene, petrol and octane were raised by Tk 5 each in June.

Compared with March, Monday’s rates will be Tk 35 higher for diesel, Tk 45 for octane, Tk 44 for petrol and Tk 43 for kerosene.

Bangladesh introduced an automatic monthly fuel-price adjustment system in March 2024, based on global prices, import costs, taxes, exchange rates, BPC margins, VAT and distribution costs.

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