Bangladesh LPG pricing panel proposes higher cylinder and autogas rates

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Bangladesh LPG pricing proposal

Highlights

Bangladesh Energy Regulatory Commission panel proposes raising the maximum retail price of a 12kg private LPG cylinder to Tk1,976 from Tk1,837 and autogas to Tk93.88/litre from Tk84.62.
Proposed supply chain cost increases include storage/bottling charges rising to Tk23.48/kg from Tk16.74, distributor commission to Tk6.67/kg from Tk4.17, and retailer commission to Tk5.83/kg from Tk3.75.
A shift to sourcing 85% of LPG imports from the U.S. has raised freight costs for Bangladesh, impacting the nation's 1.8 million tonne/year LPG market dominated 99% by private operators.

Proposed price revisions and cost components

As reported by The Business Standard, a technical evaluation committee of the Bangladesh Energy Regulatory Commission has proposed increasing the maximum retail price of a 12kg private LPG cylinder to Tk1,976 from Tk1,837 and raising autogas prices to Tk93.88 per litre from Tk84.62. The recommendations are presented by committee chairman Md Didarul Alam at a public hearing on LPG price adjustment at the BIAM Foundation in Dhaka as part of the regulatory process for setting LPG prices.

The committee also proposes higher charges across the supply chain. Storage and bottling charges for private LPG operators are set to rise to Tk23.48 per kg from Tk16.74, while distributor commission is proposed at Tk6.67 per kg from Tk4.17, increasing earnings on a 12kg cylinder to Tk80 from Tk50.

Retailer commission is also recommended to increase to Tk5.83 per kg from Tk3.75, which would raise retailer earnings on a 12kg cylinder to Tk70 from Tk45. The proposed adjustment follows the commission's review of import expenses, storage and bottling charges, and distribution costs.

Import shift adds pressure to Bangladesh market

Didarul says changing international sourcing patterns are adding to cost pressure for LPG importers. About 85% of Bangladesh's LPG imports now come from the U.S., and the move away from traditional suppliers in the Middle East and Southeast Asia is lengthening shipping routes and increasing freight expenses.

Bangladesh's LPG market consumes around 1.8 million tonnes a year, with private operators supplying nearly 99% of total volumes. The scale of that private-sector dependence means any approved price revision would directly affect a large share of household and transport fuel users across the country.

In our earlier article on the surge in crude oil shipping costs, we explained how conflict-related risks and route changes have pushed tanker rates sharply higher, turning freight into a much larger share of the delivered oil price. We noted that these higher transport and insurance costs tend to hit import-dependent markets hardest, feeding through into broader fuel and consumer prices as supply chains adjust to longer, costlier routes.

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