The Bangladesh Petroleum Corporation (BPC) anticipates saving around Tk 800 crore on fuel import costs over the next six months, thanks to reduced premium prices negotiated with fuel suppliers.
At a seminar titled “BPC’s Role in Energy Security” held at its liaison office in Karwan Bazar on Thursday, BPC Chairman and Secretary Md. Amin Ul Ahsan announced these projected savings.
“We’ve achieved significant reductions in premium costs through competitive procurement and effective negotiations. From July to December, the average premium cost dropped to $8.83 per barrel, compared to $12.03 for government-to-government (G2G) imports and $9.32 for tender-based imports. This reduction has already saved a substantial amount in the latter half of 2023,” he stated.
“The interim government positive image helps the negotiations that will cut the premium significantly,” according to him.
BPC Secretary Shahina Sultana, Marketing Director Kabir Mahmud, Operations and Maintenance Director Anupam Barua, Senior General Manager (Accounts) ATM Selim, and other senior officials also attended the seminar.
Profitability and Market Stability
Md. Amin Ul Ahsan shared that BPC cleared all outstanding dues with fuel suppliers and continues to explore ways to minimize costs.
“After VAT and taxes, we’re making a profit of Tk 1.66 per liter on diesel, creating scope for potential price adjustments. Currently, fuel prices in Bangladesh are Tk 22-25 per liter lower than in India, helping mitigate smuggling risks and maintain market stability,” he noted.
Future Efficiency through Pipeline Projects
The chairman highlighted the benefits of the upcoming Chattogram-Dhaka pipeline, stating it would further cut costs by allowing the direct transport of diesel from large ships to the Narayanganj depot.
“This project will revolutionize the fuel sector, enhancing efficiency and reducing costs,” he said.
Shifting Fuel Usage Patterns
The seminar also revealed changes in fuel consumption trends. Diesel remains the dominant fuel, making up 63% of total usage, while furnace oil accounts for 14%.
Octane consumption dipped slightly from 393,557 tons in the previous fiscal year to 387,256 tons, but aviation fuel (Jet-A1) use increased by 69,494 tons. In the 2023-24 fiscal year, Bangladesh consumed 6.76 million tons of fuel, with 92% imported and 8% sourced locally.
BPC’s Supply Chain
BPC imports fuel through nine G2G suppliers, including Emirates National Oil Company, Indonesia’s BSP, Unipeck, PetroChina International, Indian Oil Corporation, PTT International Trading, Kuwait Petroleum Corporation, Malaysia’s PETCO Trading Labuan, and India’s Numaligarh Refinery.
Additionally, four companies—Vitol Asia, Unipeck, Indian Oil Corporation, and PetroChina International—supply fuel via international tender processes.
According to BPC data, the country’s annual fuel demand stands at approximately 7.4 million metric tons, with diesel alone comprising around 5 million metric tons. Other fuels include petrol, octane, kerosene, jet fuel, and furnace oil.
