Following the outbreak of war in the Middle East, volatility gripped the supply of fuel oils. As global market prices surged, domestic prices were subsequently raised in mid-April.
While fuel prices were kept unchanged in May, the government has increased the prices of three types of fuel oil in the domestic market for the month of June.
This decision was announced today, Sunday, in a gazette notification issued by the Ministry of Power, Energy, and Mineral Resources.
According to the notification, the retail price of diesel remains unchanged at Tk 115 per litre. However, the price of kerosene has been raised from Tk 130 to Tk 135 per litre, petrol has increased from Tk 135 to Tk 140 per litre, and octane has gone up from Tk 140 to Tk 145 per litre.
The new pricing will take effect from midnight tonight.
Industry insiders note that the highest single-day spike in fuel prices in the country’s history occurred in August 2022. Following the outbreak of the Russia-Ukraine war, the price of diesel was hiked by 42.5 per cent to Tk 114.
Although public backlash forced a Tk 5 reduction later that same month, the price hikes in April pushed fuel oil to record highs in Bangladesh. With this latest adjustment, the prices of petrol, octane, and kerosene have risen even further.
In March 2024, the government introduced an automated pricing mechanism for fuel oils to align domestic rates with the global market. Under this system, prices are adjusted every month based on the import costs incurred during the preceding month.
Similar to March, the government initially held prices steady at the start of April. However, since 19 April, diesel has been retailing at Tk 115 per litre, octane at Tk 140, and petrol at Tk 135.
Among fuel oils, the prices of jet fuel (used in aviation) and furnace oil (used in power plants) are regulated by the Bangladesh Energy Regulatory Commission (BERC).
Meanwhile, the prices of diesel, kerosene, petrol, and octane are determined via executive order by the Energy and Mineral Resources Division.
The conflict in the Middle East escalated on 28 February following US-Israeli strikes in Iran, severely impacting the global fuel supply chain. This triggered widespread anxiety over domestic fuel supplies, leading to long queues forming at filling stations.
However, the supply of fuel oil to the market was increased on 20 April, a day after the new prices took effect. Consequently, overcrowding at filling stations gradually eased, and the situation returned to normal.