Fuel oil price hike to put people under immense pressure

People in droves wait in a refueling station in Khulna following the government's annoucement to hike fuel prices from 5 August midnight
Prothom Alo

People would be under immense pressure to adjust with the price hike of fuel oil in the country, said Bangladesh Bus-Truck Owners' Association president Ramesh Ghosh.

He said he cannot recall any precedence of increasing the fuel price so much at one go.

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Ramesh, also the owner of Shyamoli Paribahan, termed the hike unprecedented.

The fuel oil price hike would have a domino effect and cost of essential commodities would shot up as a result, he thinks.

The government on Friday night increased fuel oil price. According to power, energy and mineral resources ministry, diesel price has been increased by Tk 34 to Tk 114 per litre while octane price hiked by Tk 46 to Tk 135 and petrol by Tk 44 to Tk 130. The new prices have been effective after 12 in the night.

Earlier, in November last year, the government increased the price of diesel and kerosene by Tk 15 to Tk 80 per litre. As a result, the bus fare was disproportionately increased by around 27 per cent and launch fare by 35 per cent.

It would have been bearable if the price of fuel was raised through public hearing, but now the rights of the consumer have been destroyed
M Shamsul Alam, CAB senior vice president

Transport sector consumes 65 per cent of the fuel oil sold by Bangladesh Petroleum Corporation (BPC). Agriculture sector uses16 per cent, industrial sector 7 per cent and power sector 10 per cent of the fuel BPC sells.

The fare of bus, launch and truck would increase once again due to the fuel price hike. Fare of other transports would also increase simultaneously. The expenditure will increase in the agricultural sector, resulting in an increase of commodity prices.

Meanwhile, people rushed to filling stations last night after the news of the increase broke. Prothom Alo correspondents saw long queues of cars on Friday night in front of different refueling stations throughout the country.

Power hike looming?

Bangladesh Energy Regulatory Commission (BERC) increased gas tariff in retail level on 5 June following proposals of state-owned companies. Price of double burner in households were increased to Tk 1,080 from Tk 975.

Dhaka WASA on 8 July increase water tariff by 5 per cent which will be effective from 1 September. WASA is trying to further increase the tariff. The agriculture ministry hiked price of Urea fertiliser by around 38 per cent last week.

State minister for power, energy and mineral resources ministry Nasrul Hamid has indicated the prices of power and gas would increase once again. A proposal of increasing power tariff is under process in BERC.

Rights of consumer shattered

Prices of all the imported goods have shot up after dollar’s exchange rate increased at the kerb market to Tk 108 from Tk 86. Price hike of fuel by big margin will now put people under immense pressure.

Consumers Association of Bangladesh’s (CAB) senior vice president M Shamsul Alam told Prothom Alo that adjustment of deficit was one of the conditions for availing the IMF loan. The government’s move to accommodate the deficit by raising prices would hit the consumers harder than cyclonic storms like Sidr and Ayla.

M Shamsul Alam also said that the deficit could have been adjusted by stopping corruption and wastage but the government did not do that.

It would have been bearable if the price of fuel was raised through public hearing, but now the rights of the consumer have been destroyed, he added.