The escalating conflict in the Middle East has triggered fresh instability in global energy markets, sparking deep concerns for Bangladesh’s power generation and industrial sectors.
As an import-dependent nation, Bangladesh faces a dual threat: the potential for a spike in international oil prices and significant uncertainty regarding Liquefied Natural Gas (LNG) supplies from Qatar.
Analysts warn that if this regional confrontation persists, the resulting supply chain disruptions could drive up transportation costs and inflate the prices of daily essentials, placing immense pressure on the national economy.
Following the opening of international markets, oil prices have already shown a sharp upward trend.
West Texas Intermediate (WTI) crude surpassed the $100 per barrel mark, a stark contrast to its price of $67.02 just prior to the onset of US-Israeli strikes on Iran in late February.
Similarly, North Sea Brent crude reached $113.44 per barrel before stabilizing near $111.
This rapid appreciation underscores Bangladesh's vulnerability; while oil has relatively diverse global sources, the supply chain for LNG and LPG is far more restricted, making any disruption in these sectors nearly impossible to resolve quickly.
Natural gas remains the backbone of Bangladesh’s energy infrastructure, powering the majority of the nation’s electricity plants and driving vital industries such as readymade garments (RMG), fertilizers, ceramics, and textiles.
However, as domestic gas production has dwindled over the last decade to just 1.7–1.8 billion cubic feet per day—against a demand of 4 billion—the country has become heavily reliant on imported LNG.
Since beginning commercial imports in 2018, Bangladesh has leaned on Qatar for approximately 60% to 70% of its total LNG needs due to favorable long-term contracts.
The conflict has placed the Strait of Hormuz, a critical maritime artery for global energy, under intense scrutiny.
Recent reports of missile attacks on Qatar’s Ras Laffan industrial zone—the world’s premier LNG processing and export hub—have further complicated the landscape.
With significant portions of global LNG supply from Qatar’s Ras Laffan and Iran’s South Pars gas field now at risk, international gas prices in regions like Europe have already jumped by 20% to 25%.
For Bangladesh, a disruption in Qatari supplies would force the government into the volatile "spot market," where prices are significantly higher than long-term contract rates, potentially ballooning the national energy subsidy burden.
A sustained gas shortage threatens to trigger widespread loadshedding, which would directly paralyze industrial production and urban life.
Leaders in the export sector, including representatives from the BGMEA, emphasize that the garment industry’s global competitiveness relies on affordable and steady energy.
If manufacturers are forced to absorb the higher costs of spot-market LNG or face production halts due to power outages, the country’s export growth could suffer a significant setback.
Government response and long-term strategy
In response to the crisis, the Ministry of Power, Energy, and Mineral Resources has initiated the process of purchasing LNG from the spot market and is exploring alternative supply routes through diplomatic channels with India and China.
While these are necessary short-term fixes, geologists and energy experts, such as Professors Badrul Imam and M Tamim, argue that a fundamental shift in strategy is required.
They advocate for an aggressive domestic gas exploration program—both onshore and offshore—to reduce import dependency. Furthermore, there is an urgent call to scale up renewable energy, particularly solar power, to build a more resilient and self-sufficient national energy grid.
Ultimately, the ongoing Middle East crisis is more than a geopolitical event; it is a critical test of Bangladesh's energy security.
Finding diverse fuel sources and maximizing domestic resources have now become the most urgent priorities for the nation's economic survival.