Fuel prices unlikely to rise further: BPC Chairman

Even if the conflict in the Middle East worsens, the government does not want to increase fuel prices further in the domestic market, said Bangladesh Petroleum Corporation (BPC) Chairman Dr Rafiqul Islam.

He said there would be no shortage in fuel imports, payments or stocks through December.

The government recently raised the prices of all types of fuel, including diesel, by Tk 20 per litre in a single move. The increase has affected the passenger and goods transportation sectors as well as the prices of essential commodities.

Fuel prices are usually revised at the beginning of the month, but this time the government announced the increase in the third week of September.

BPC Chairman Rafiqul Islam said the government had been compelled to raise prices because there was no room to wait any longer.

“We had to take the decision to increase prices. There was no scope to wait for a few more days,” he said. “We hope to receive some support from the government. At the same time, the additional revenue generated from the price increase should help us manage the situation.”

The government has been under pressure over fuel supplies since the beginning of the latest instability in the Middle East. Against this backdrop, Prime Minister Tarique Rahman held a meeting with the Iranian president on the sidelines of the United Nations General Assembly.

Ensuring the uninterrupted supply of imported fuel arriving through the Strait of Hormuz was among the key issues discussed at the meeting. The government has also stepped up communication with energy-rich countries, including Saudi Arabia and the United Arab Emirates.

On fuel supplies and reserves, the BPC chairman expressed confidence, saying there was no shortage in stocks.

“We have the normal level of stock required. There is no problem with reserves,” the BPC Chairman said.

He added that the procurement process for the country's required fuel through December had already been completed. Discussions with the Ministry of Finance over financial arrangements had also brought the corporation to a “comfortable position.''

According to Rafiqul Islam, Bangladesh currently has the capacity to maintain around 45 days of fuel stocks. Work is also underway to expand storage capacity with the aim of developing a 90-day reserve capability.

However, global fuel prices have been rising for some time, and there is uncertainty over when the upward trend will ease.

Asked about the possibility of further price increases, the BPC chairman said the corporation would use its available capacity to avoid another hike.

“We will try our best so that prices do not have to be increased again under any circumstances.''

He acknowledged that the international market remains uncertain, but said that even if global prices rise somewhat further from their current levels, Bangladesh may not need to raise domestic fuel prices again.