Cylindered LPG prices much higher than international market: State minister

Bangladeshi suppliers are charging much higher than international market for cylindered LPG used for cooking at households, Nasrul Hamid Bipu has said.

The government will push the companies “strongly” to cut the prices, the state minister for power, energy and mineral resources says.

Speaking at the opening of the two-day South Asia LPG Summit in Dhaka on Sunday, he said the government would “soon” make a policy and appoint regulators to rein in the “dominance” of some private firms in the LPG market.

After some of the guests pointed out that the demand for LPG is increasing fast in Bangladesh as the economy is growing, Bipu said, “Prices of LPG are much higher than those in international market.”    

“The private LPG firms are raising the prices as they wish. It’s time we strongly held them to account,” he said. 

Prices rise up to Tk 500 per cylinder by the time the product reaches the consumer via multiple suppliers when the prices are dropping in international market, according to the state minister.

Around 22 firms are operating in Bangladesh while 55 have been licenced to supply LPG in cylinders, according to Bipu.

LPG-run vehicle users have to pay Tk 42 per litre for refuelling now while the 12-kilogram cylinders for household users are available for Tk 1,200 to Tk 1,300 per cylinder.  

“We are thinking how to cut LPG prices. We are making a policy. This business must be brought under regulation to check whether the traders are following the rules,” State Minister Bipu said.

Government firm BPC is also trading in LPG, but its condition is “very bad”, the minister said.

FBCCI Senior Vice-President Sheikh Fazle Fahim said it was “incorrect” to say that the LPG firms were profiteering.

“The companies adjust the prices with international market every three months. But the prices soar at dealer and agent levels,” he claimed.

Around 20 million people started using LPG instead of other sources of energy in past four years, pushing the annual demand from 80,000 tonnes to 1 million tonnes in Bangladesh, according to LPG Operators Association of Bangladesh President Azam J Chowdhury.  

At least 10 more firms are joining Bangladesh’s LPG sector in next two years, the summit heard.

More than 80 local and international firms are showcasing latest LPG technologies and providing information at the summit joined by over 200 foreign representatives at the International Convention City Bashundhara.

FBCCI President Shafiul Islam Mohiuddin and BPC Chairman Shamsur Rahman, among others, attended the opening session.