Volume 16, Issue 10


The alarming upward trend of oil price in a volatile global market has worried the policymakers of Bangladesh. The crude oil price may go beyond US$ 100 /bbl if the present trend continues. Bangladesh oil industry is not matured enough for adopting market-based oil pricing yet. Bangladesh follows administered price. The government provides huge subsidy when price goes higher and try to recover the losses when price remains on the lower side. In this scenario, the present rising trend has already created great tension as the demand has steadily grown in every sector such as transportation, agriculture and power sector keeping pace with the economic growth. With the country’s general election round the corner, the government is not in a position to adjust the price of petroleum products or power. It is actually a catch 20 situation for the government. All stakeholders must know at what price BPC and the government is buying crude and other products from world market and how pricing is structured. By setting up strong regulatory mechanism and ensuring strong and efficient regulatory control, the government must move out from the monopoly of the petroleum sector.


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