Bangladesh raises diesel, kerosene prices by 23% amid global volatility

The government has raised the prices of diesel and kerosene by Tk 15 to Tk 80 per litre, citing a hike in global prices.

The power, energy and mineral resources ministry announced the 23 percent rise on Wednesday after State Minister Nasrul Hamid recently hinted at a spike in the price of diesel in the face of a volatile international market for crude oil.

He had mentioned reports of oil being smuggled across the border to India whenever there is a marked disparity in the prices of fuel oil emerges between the South Asian neighbours.

The ministry highlighted India’s readjustments as an example of how neighbouring countries are dealing with the crisis. On Monday, the price of diesel in India was Rs 101.56 or Tk 124.41 – Tk 59.41 higher than the price in Bangladesh, according to the notice.

It also said Bangladesh Petroleum Corporation was losing Tk 200 million daily by selling diesel and furnace oil at lower prices. In October, the state-owned corporation suffered a loss of over Tk 7.26 billion.

The government had previously fixed the prices of petroleum products in April 2016.

In Bangladesh, diesel alone accounts for more than 73 percent of domestic fuel consumption. It is used in various fields, including road and sea transport, agriculture and power generation.

In an immediate reaction to the change in diesel price, Bangladesh Road Transport Owners Association Secretary General Khandaker Enayetullah demanded a rise in bus fares to cover the additional cost of fuel.

“The transport sector has suffered heavy losses due to the coronavirus pandemic. It won’t be able to survive an increase in fuel price just after the lockdowns.”

He said the government raised the diesel price without consulting transport owners. “The government and BRTA (Bangladesh Road Transport Authority) should swiftly readjust transport fares."

The prices of commodities are likely to rise as the cost of transporting goods is also increasing along with diesel price.

The kerosene price hike will hit the families and shops that use the fuel for cooking.