The government on Monday, reduced fuel prices by Tk5 to alleviate the pressure on consumers caused by the recent price hikes due to the Russia-Ukraine war.
The price reduction applies to all three major petroleum products: petrol, octane and diesel.
The fuel price was adjusted in line with global market trends and the recent duty exemption on diesel, said officials at the Ministry of Power, Energy and Mineral Resources.
In line with the new decision, diesel and kerosene will cost Tk109 per litre, petrol Tk125, and octane Tk130. The new prices are effective from Tuesday.
On Monday, State Minister for Power, Energy and Mineral Resources Nasrul Hamid told Dhaka Tribune: “The reduced price of fuel oil is going to be effective from tonight. We are trying to issue a government circular on the reduction of the price of octane, petrol and diesel by Tk5 per litre.”
The fuel price adjustment in the domestic market at a time when prices remain high in the international market is one example of the positive initiatives taken by the people-friendly Awami League government,” he said.
The move will require the government to provide high subsidies, but the decision was still taken to offer relief to the people, Nasrul Hamid added.
“If prices come down further in the international market, we will readjust accordingly,” he further said.
He said government high-ups were also looking at the hike in prices of various commodities caused by the fuel price hike. They would take all possible initiatives to ease the sufferings of the people.
The fuel price adjustment comes a day after the government slashed duty on diesel import by half to 5%, while also doing away with all advance taxes on its import.
Earlier on Monday, the state-owned Bangladesh Petroleum Corporation (BPC), analysing the impact of the recent duty cut on diesel imports and withdrawal of advance income tax, suggested the change.
Experts in the industry and in the transport sector believe that the new order came against the backdrop of the consistent demand for a reduction from politicians and business circles, as well as the common people, following a hike in the prices of all petroleum fuels.
The government on August 5 went for the largest ever hikes in the price of fuel oil — ranging from 42- 52% — with effect from August 6.
At the consumer level, the retail prices of diesel and kerosene went up to Tk114 per litre, up by a whopping 42.5% from Tk80 per litre. Octane price was raised to Tk135 per litre, up a deeply troubling 51.7% from Tk89 per litre – again the largest hike on record.
A litre of petrol was set at Tk130 with a 51% hike from Tk86 per litre previously.
At the time, State Minister for Power, Energy and Mineral Resources Nasrul Hamid said the government had no choice but to increase fuel oil prices in line with prices in the international market, but also held out the assurance that a readjustment in the price would be made if the price came down in the international market.
Bangladesh annually imports about 6.5 million metric tons of petroleum, of which 5 million metric tons are refined. Of these, the major portion is diesel – mainly consumed by the transport, industry and power sectors.
The price of petroleum began witnessing a decreasing trend from August 1 after the per barrel crude oil price was recorded at $130. After that record high, the per barrel price dropped below $90.
