Over the past decade, Bangladesh has experienced rapid economic and social development, where energy oil plays a crucial role in industrialisation, trade, real estate investment and transportation expansion.
Due to limited domestic oil production, about 65-70 percent of the total energy demand depends on imports, particularly diesel and octane. The widespread use of diesel-based machinery and vehicles in agriculture, industry, transportation and power sectors has made the economy heavily dependent on supply.
Recently, a clear crisis in the oil market has been observed. Long queues, “Sold Out” signs at many pumps and reports of diesel shortages have created public concern. Despite repeated government assurances that “there is sufficient stock” and “supply has not stopped,” in reality, crowding and panic are visible in the market.
In Bangladesh, three state-owned companies-Padma Oil, Meghna Petroleum and Jamuna Oil Company-are the primary suppliers of fuel. They distribute oil through approximately 2,500 to 2,800 pumps. Annually, about 6 to 7 million tonnes of oil are imported, a large portion of which is refined. About 20 percent of crude oil is refined domestically. Around 65-70 percent of oil demand is for diesel, and nearly 70 percent of gas imports pass through the Strait of Hormuz. Therefore, instability in the Strait poses a major threat to the country’s energy security.
There are two main reasons behind the oil supply crisis. The first is international geopolitical pressure, particularly conflicts in the Middle East and instability in the Strait of Hormuz. This strait is one of the world’s most critical energy channels, with more than 20 million barrels of oil transported daily. Due to the crisis, Brent crude prices have fluctuated between $100 and $120 per barrel, impacting energy markets in Bangladesh and other South Asian countries.
The second reason is domestic management weaknesses-market syndicates, panic buying, corruption and lack of risk management. Failures of state oil companies, inadequate stock management and excessive hoarding by syndicates have intensified the crisis.
Bangladesh’s geopolitical position is also significant in terms of energy security. Diplomatic measures to address international pressures related to the Strait of Hormuz and Middle East tensions, such as seeking temporary relaxation of restrictions from the United States on importing Russian diesel, could help ensure energy security.
However, despite international pressures, domestic market mismanagement is intensifying the crisis. In other words, Bangladesh’s oil crisis is the result of a combination of international geopolitical pressures and domestic management failures, creating uncertainty in the energy market. Without long-term strategic stockpiling, alternative sources and strong risk management, resolving this issue will be difficult. Continuous oil supply is essential for the country’s economy, transportation, industry, and agriculture.
During the recent oil crisis, the government’s measures have played a dual role. On one hand, the government repeatedly assured that there is no oil shortage, supply is stable and stock is sufficient.
According to the Ministry of Energy, by the end of April, total oil stock stood at approximately 255,018 metric tonnes, including 122,660 metric tonnes of diesel, along with sufficient reserves of jet fuel, octane and petrol. Additionally, efforts have been made to control local prices and reduce fluctuations through international supply agreements.
However, the experience of ordinary people and field-level data indicate a significant gap between government claims and reality. Long queues, irregular supply and rapid price increases show that government measures have been only partially effective. The shortage of oil has particularly affected agriculture, transportation and small businesses. Farmers report difficulties in obtaining fuel, while suppliers claim limited availability. Transport owners have increased truck fares by 20-30 percent due to irregular supply, directly accelerating the rise in prices of food and essential goods.
Government measures include energy-saving initiatives such as reducing office hours in public and private sectors, limiting market hours and controlling vehicle sales. Efforts are also being made to diversify import sources so that supply is not disrupted if a specific route, such as the Strait of Hormuz, is blocked. However, these initiatives provide only short-term solutions, while long-term structural solutions remain absent.
The root causes of the crisis are both international and domestic. Internationally, geopolitical tensions in the Middle East, particularly conflicts involving the United States, Iran and Israel, and uncertainty in the Strait of Hormuz are significant factors. These have disrupted global oil supply chains, directly affecting import-dependent Bangladesh. The International Energy Agency has warned that the crisis may worsen in the future.
On the other hand, domestic challenges have further complicated the situation. Panic buying, hoarding, syndicate behaviour and lack of market control have worsened the crisis. Reports suggest that many retail buyers are stockpiling excessive fuel, while some pumps and distributors are engaging in opportunistic practices. Although the government has taken steps such as appointing tag officers, conducting mobile court operations and recovering illegal stock, controlling the situation has proven difficult.
As a result, Bangladesh’s oil crisis is not solely due to international factors; domestic market behaviour, syndicates and public panic have intensified it. The impact on transport, agriculture and small businesses is directly disrupting economic productivity. Analysts believe that while alternative import channels and international agreements have been explored, stronger coordination is needed in internal stock management, refinery policy, anti-corruption measures and market regulation.
In short, the current oil crisis in Bangladesh is a complex outcome of both international geopolitical pressures and domestic market mismanagement, panic buying and syndicate activities. Government measures have brought some positive results, but more effective steps are needed to reduce the impact on agriculture, transportation and small sectors and to establish long-term solutions.
However, achieving a lasting solution requires more than just restoring international supply or resolving Strait of Hormuz issues, it demands a comprehensive transformation strategy that integrates government initiatives, international diplomacy, domestic market control and new energy opportunities.
First, government must adopt a long-term energy security roadmap. This should include strategic fuel stockpiling, long-term import agreements, coordination with geopolitical blocs and increased domestic production. Such planning is essential to maintain national stability and economic activities.
Second, diversification of import sources is necessary, not only from the Middle East but also from Southeast Asia, Africa and Russia. This strategy will help mitigate global market volatility and geopolitical instability.
Third, strict domestic market regulation is essential. Monitoring boards, eliminating syndicate activities, controlling hoarding and excessive purchasing and enforcing legal measures on a daily and weekly basis are necessary. This system should include transparent market information, price control and emergency communication to prevent public panic and ensure rational consumption.
Fourth, expanding domestic production and refinery capacity is crucial in the long run. Increasing refineries through public and private initiatives, enhancing gas extraction and strengthening LNG terminals are vital for energy security.
At the same time, investing in renewable energy such as solar and wind will reduce dependence on oil. Public awareness campaigns on efficient energy use should also be implemented to control panic buying and hoarding.
Fifth, maintaining balanced international diplomatic relations is essential. Rather than relying on a single political or military bloc, Bangladesh must build active global partnerships. Such a multilateral strategy will strengthen energy security and reduce the impact of any single geopolitical crisis.
Bangladesh’s energy security risks are multidimensional. International geopolitical instability, particularly in Middle Eastern and Southeast Asian energy-producing countries, may create significant supply disruptions in the future. The International Energy Agency and the World Bank have warned that global energy security now depends on diversified and stable supply channels across multiple countries.
Secondly, domestic market weaknesses-such as syndicates, panic buying, illegal hoarding and irregular price control-can further intensify crises. In April 2026, the diesel and octane markets showed how hoarding and price manipulation disrupted supply chains in certain areas.
Thirdly, domestic production and refinery capacity remain limited. Bangladesh’s two main refineries, Port Arthur Refinery and the Maheshkhali Oil Terminal, have limited capacity to meet current demand. Without expansion in the next decade, global market fluctuations and domestic demand pressures could severely impact the economy.
Fourthly, alternative and renewable energy usage remains insufficient. Without increased investment in solar, wind and bioenergy, reducing dependence on oil will not be possible. Even minor international or political conflicts could cause significant internal market fluctuations.
Fifthly, overdependence on political blocs can make energy policy unstable; therefore, maintaining multilateral diplomatic relations is essential.
It can be recommended that Bangladesh formulate a long-term energy security policy that includes diversified oil and gas imports, expansion of domestic refineries, increased use of renewable energy, prevention of syndicates and public awareness.
The recent oil crisis proves that energy security depends not only on international markets but also on domestic management, syndicates, market behavior and public awareness. While instability in the Strait of Hormuz and Middle Eastern conflicts have international impacts, internal issues such as panic buying and hoarding have intensified the crisis.
Government measures-alternative import channels, increased stock, price control, and regular operations-are corrective but not definitive solutions.
What Bangladesh needs is a long-term strategy, diversified international relations, strong internal control mechanisms, expansion of domestic production and refineries and increased investment in renewable energy. With an integrated plan, Bangladesh can not only survive crises but also achieve sustainable energy security. Market syndicates and panic will decline, and economic and social stability will be ensured in the long run.
In conclusion, there is no alternative to a coordinated solution combining international and domestic strategies to address Bangladesh’s energy crisis. With careful, stable and planned actions by the government, industry and the public, the country can eventually establish itself as a model of energy security and economic stability.
This writer is an economist, researcher and columnist.
