Oil imported with Tk 19,500 crore from project accounts, BPC claims projects will not be affected
Photo: Collected
A major crisis has emerged in the fuel oil supply system due to the Iran war, which has in turn created various complications over imports. In this situation, the Bangladesh Petroleum Corporation (BPC) has used Tk 19,500 crore kept in the accounts of various projects, including the second unit of Eastern Refinery or ERL-2, to keep imports going.
The information about the use of this money was given in the BPC’s working paper prepared for presentation on Tuesday at the first meeting of the Jatiya Sangsad’s Committee on Public Undertakings. The working paper said the BPC incurred a loss of around Tk 22,875.66 crore from March to August in maintaining uninterrupted fuel supply in the country against the backdrop of war in the West Asian countries. In this situation, the agency has continued fuel oil imports for the last seven months by taking Tk 19,500 crore so far from various project heads including ERL-2.
This has raised the question of whether the work of the projects from whose accounts the money has been taken will be disrupted. However, BPC Chairman Rafiqul Islam claims this money is the BPC’s own. The funds have been reallocated on a priority basis after calculating how much money will be needed in which project and when, so there will be no impact on the work of the projects.
He told the media that the money kept in the accounts of various projects belongs to the BPC itself. The funds have been reallocated considering how much money the projects will need and when in the current and next fiscal years, and no new money has been taken from the ministry for this.
The working paper of the meeting said Tk 15,000 crore to Tk 20,000 crore, equivalent to the price of two months’ oil, has to be preserved as working capital to ensure energy security. But the BPC’s working capital has fallen due to selling oil at subsidised prices. According to the agency’s calculation, the loss in the six months from March to August was around Tk 22,875.66 crore.
According to the working paper, the average price of diesel in the international market was $86 per barrel in February. In March it rose to $186.59. In April, the price of diesel peaked at $284.95 per barrel. The average price was $165.82 until the time the working paper was prepared in September.
After the latest price adjustment, the price has to be $110 per barrel for the cost of diesel to be recovered. As a result, the BPC is incurring losses even at the current price.
The automatic pricing system for fuel oil was introduced in the country in March 2024. Since then, the prices of diesel, kerosene, octane and petrol were being adjusted every month in line with the international market. The working paper said that although prices in the international market rose sharply from March due to the war in West Asia, prices were not raised in the country as per the automatic system for nearly five months in the public interest.
In the meantime, the price of diesel was raised from Tk 100 to Tk 115 per litre on 19 April. Later, on 1 June, the price of kerosene was set at Tk 135, octane at Tk 145 and petrol at Tk 140, while diesel was kept at Tk 115. Most recently, on 21 September, the prices of the four types of fuel oil were raised by Tk 20 per litre each. Diesel is now selling at Tk 135, kerosene at Tk 155, octane at Tk 165 and petrol at Tk 160.
