Despite steady international market rates, the retail price of liquefied petroleum gas (LPG) in Bangladesh increased by Tk 0.66 per kg from March.
Over the previous eight months LPG prices have been gradually increasing, now reaching Tk28.56 for each kg.
The new price for LPG has been fixed at Tk 123.52 per kg, up from Tk 122.86 in February, the Bangladesh Energy Regulatory Commission (BERC) said on Sunday.
In August 2023, LPG prices were Tk 94.96 per kg. The cost of LPG has been steadily rising since August and has continued to do so through November, December, January, February, and now March.
Compared to August 2023, the price of a 12 kg LPG cylinder has increased from Tk 1,140 to Tk 1,482 in March for a 12 kg cylinder at the retailer level. In total, Tk 342 increased in the last 8 months consecutively.
Various reports show the LPG price in the global market has remained the same for the last two months. According to Reuters, Saudi Arabia’s state oil producer Aramco 2222.SE has left unchanged the official selling prices (OSPs) for liquefied petroleum gas in March 2024.
Aramco’s March OSP for propane was stable at $630 per metric ton PRO-OFFCL-SA, and for butane, it was $640 per ton. Another news agency, Arab News, stated Aramco’s February OSP for propane is $630 per tonne, while the price for butane has been set at $640 per tonne.
In response to inquiries about the domestic price hike, BERC Chairman Nurul Amin explained that the dollar exchange rate adjustment contributed to the decision.
The exchange rate used for calculations was lowered from Tk 120.52 in February to Tk 119.89 in March, making the dollar cheaper by Tk 0.63 than the previous month. He said. “However, LPG operators reported increased vessel fares, necessitating a slight price adjustment.”
Household users and Consumers are finding it difficult to keep up with growing living expenses. They are in a terrible situation as a result
of LPG price increases that have been happening for the eighth consecutive month. LPG and autogas prices rose by 7 points and fell by 5 points in 2023, respectively.
In January, March, April, June, and July of last year, the cost of gasoline and LPG dropped. In February, May, August, September, October, November, and December, prices also went up.
BERC, at a press briefing Sunday, detailed the adjustment, noting that the price for a standard 12 kg LPG cylinder will now be Tk1,482, inclusive of VAT, marking an increase from the previous Tk1,474. This adjustment follows a rational scale across various LPG cylinder sizes, ranging from 5.5 kg to 45 kg, addressing the need for a proportional price revision across different consumer segments.
Furthermore, the price for ‘autogas,’ the LPG variant used in motor vehicles, has also seen a revision, now priced at Tk68.05 per litre, including VAT, a slight increase from Tk67.68.
Sources said the market size of the LPG industry in Bangladesh is $3.2 billion. However, more than 98 per cent of this industry is dependent on imports. In 2022, Bangladesh witnessed a significant import of approximately 1.4 million metric tonnes of liquefied petroleum gas (LPG).
Based on the analysis conducted by numerous industry experts, it is anticipated that the LPG market has the potential to experience rapid growth, with the demand expected to reach approximately 3.0 million metric tonnes by the year 2030.
Notably, LPG prices marketed by the state-owned LP Gas Company will remain unchanged. This exception is attributed to its local production and the company’s minimal market share, which is less than 5 percent.
According to BERC, the decision to adjust LPG prices comes in the wake of rising costs in the international market, specifically tied to the increase in the Saudi CP (contract price), which serves as a benchmark for local operators importing LPG primarily from the Middle East.
