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Dhaka Tribune

PM rules out oil price cut

Update : 17 Feb 2016, 02:44 PM

Prime Minister Sheikh Hasina has ruled out the possibility of lowering the prices of fuel oil in domestic market till the loans of Bangladesh Petroleum Corporation (BPC) are paid back.

The government would consider reducing the prices after repayment of the loans, she told parliament in response to a question on Wednesday.

The statement came just a day after top four oil exporters agreed to cap out and two days after Finance Minister AMA Muhith hinted a cut by Tk5-10 a liter within next couple of days.

Muhith announced the possible oil prices cut after a meeting with Prime Minister Sheikh Hasina as the prices of fuel oil drastically had come down in the international market over the last three months.

The finance minister the same day also held a meeting with a six-member World Bank team on Environment headed by Senior Director of World Bank Miss Paula Caballero at his secretariat office.

Muhith said the decision of the decrease in the prices of fuel oil came after the meeting with the prime minister as the head of Energy Ministry.

Meanwhile, top oil exporters Russia, Saudi Arabia, Qatar and Venezuela on February 16 agreed to limit their oil output to the level of January after a secret meeting, reported Reuters.

The same news said the first joint Opec and non-Opec deal in 15 years was aimed at tackling a growing oversupply of crude and helping prices recover from their lowest in over a decade.

When diesel price soared up in international market, diesel in local market was sold at subsidised prices. That’s why BPC is burdened with loans of thousands of crores of taka, Sheikh Hasina told the Jatiya Sangsad.

“When we raised oil prices by Tk1 or Tk2 we had to face hartal (general strike). Now petroleum corporation is earning some money and paying the loan. Already Tk5000cr loan was paid off and it has to pay more apart from vat and tax,” she told parliament.

“First let us pay off the loans and if required we will reduce the oil prices,” she said replying to a query in parliament.

The average import price of crude oil was a little over $75 a barrel in fiscal 2014-15, down from nearly $110 a barrel in the previous year. The average price this year dropped to $52 a barrel, according to Bangladesh Petroleum Corporation.

In replying to another query, the premier said Bangladesh is the perfect place for investment and there is sufficient investment in Bangladesh and more investment is coming.

“We have formed special economic zone. Bangladesh is the perfect place for investment. Here we have industrious young Turks,” she said.

Hasina admitted that there are some crisis of gas in industrial sector.

“We have done seismic survey and taken imitative to explore the new gas fields and to extract gas from those fields. We are providing gas connections.”

Replying to another question of independent lawmaker Haji Selim that investment is not taking place in Bangladesh, Hasina said: “I do not know where the honourable lawmaker got this information from. Japan, China, India, Korea and European countries are investing in the country. Japan has invested six billion dollar here. Many big countries of the world are in the queue to investment here. To them Bangladesh is the most perfect place for investment.”

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