The Bangladesh Petroleum Corporation (BPC) is set to import 1,660,000 tonnes of refined fuel oil from eight foreign companies for the first half (January-June) of this year, which involve moderate premiums as compared to previous contracts.
The country’s sole importer and distributor of oil would have to spend around Tk11,666 crore for the imports, while the total import from the eight companies during the January-December period is expected to be around 3,290,000 tonnes.
Officials said the premiums (freight and other costs) for all petroleum products except gas and oil had not increased, as freight charges have gone down globally.
A high-powered delegation, led by Energy Secretary Md Mozammel Haque Khan, visited Singapore last November to negotiate the premium for the oil purchase for the period.
The premiums – transportation, insurance and other costs – are reviewed every six months.
Through government-to-government contracts, the BPC has signed two-year (minimum) deals with interested national oil companies of eight countries. Eight proposals by the energy ministry on public purchase and sources would be placed at the next cabinet committee.
BPC Chairman Md Eunusur Rahman told the Dhaka Tribune that the demand for diesel declined over the last few months because of the smooth supply of electricity, which was used for agricultural machinery, stabilising the demand for fuel.
He also said the total demand for fuel oil would be 25-26m tonnes over the next six months, going up to 50-52m tonnes by the end of the year.
“Foreign exchange pressure will be relaxed if the demand for fuel declines in the next couple of months,” Eunusur added.
The demand for diesel will decline over the next six months because of an adequate generation of electricity across the country, said a senior official of the Energy Division.
For the next six months, the projected total demand for diesel is 1,760,000 tonnes while furnace oil demand is 520,000 tonnes, compared to a 1,800,000 tonnes demand for diesel for the same period in the previous year.
The eastern refinery would refine 180,000 tonnes each of crude diesel and crude furnace oil.
During the first half of the year, 1,220,000 tonnes of diesel is expected to be imported, while the rest of the imports include 320,000 tonnes of furnace oil, 15,000 tonnes of petrol, 140,000 tonnes of jet fuel and 5,000 tonnes of kerosene.
In the contract, the premiums for jet fuel and kerosene have been set at $5.80 per barrel, which was the same during the July-December period of 2013. The premium for furnace oil, however, dropped by $2 per tonne to $35 from $37 during the first half of the 2012-13 fiscal.
The suppliers are – Kuwait Petroleum Corporation, UAE-based Emirates National Oil Company, Vietnamese National Oil Company or Petro Limex, PT Bumi Siak Pusako of Indonesia, Philippines PNOC Exploration Corporation, Petrochina International (Singapore) Pte Ltd, Malaysian PETCO Trading Labuan Company Ltd, and Chinese Unipec Singapore Pte Ltd.
Emirates National Oil Company raised premiums of diesel from $4.00 to $4.80 during the first half of fiscal year 2012-13.