Govt to import another 5,00,000 tonnes of fuel to boost reserves

The government is procuring another 5,00,000 tonnes of fuel oil to strengthen the country's fuel reserves amid ongoing geopolitical tensions in the Middle East, aiming to ensure uninterrupted economic and commercial activities and meet domestic energy demand.

Under the new decision, the government will import an additional 4,80,000 tonnes of fuel oil, considering the country's target of maintaining a 90-day fuel reserve. The shipment will include 3,90,000 tonnes of diesel and 90,000 tonnes of jet fuel.

Singapore-based renowned company Unipec Singapore Pte Ltd will supply the fuel at an estimated cost of Tk7672.66 crore.

The Energy and Mineral Resources Division said the Bangladesh Petroleum Corporation (BPC) is procuring the fuel through an international open tender process. The Cabinet Committee on Government Purchase recently gave policy approval to BPC's proposal.

Confirming the matter, Joint Secretary of the Energy and Mineral Resources Division Monir Hossain Chowdhury told BSS that the government generally imports fuel oil, particularly diesel and jet fuel, every six months based on the country's demand.

Accordingly, BPC sent a proposal to the ministry to meet demand for June, July and August. It was subsequently placed before the Cabinet Committee on Government Purchase for approval, which has already been granted, he added.

He added, "We have issued the administrative clearance and sent it to BPC. As the next step, BPC will issue the NOA (Notification of Award) to the supplier. The company will then begin supplying the fuel."

Officials concerned at BPC said that as the global fuel market has become highly volatile due to renewed geopolitical instability across the Middle East and security concerns surrounding the Strait of Hormuz, the current government, led by Prime Minister Tarique Rahman, has taken a bold and far-sighted initiative to ensure the country's internal energy security.

He said priority has been given to keeping the economy running, maintaining uninterrupted industrial production and agricultural activities, and ensuring normal air transport operations.

BPC Manager (Trade and Operations) Md. Mizanur Rahman told BSS that the Cabinet Committee on Government Purchase approved the international tender proposal on 10 June, and the approval letter was received on 17 June.

"The NOA has already been issued to the supplier. Following the signing of the final agreement, the fuel supply process will begin very soon," he said.

He added, "The current government's objective is to maintain a 90-day fuel oil reserve in the country at any cost. At present, there is a reserve sufficient for around 60 days. Fuel will continue to be imported regularly every six months to meet demand."

Financial expenditure and dollar estimate

According to a BPC proposal submitted to the Energy Division on 24 May, up to 390,000 tonnes of diesel and 90,000 tonnes of jet fuel will be imported during the June-August period in line with demand. The tender also allows some flexibility in quantity to ensure uninterrupted fuel supply across the country.

Based on Sonali Bank's exchange rate of 13 May ($1 = Tk123.25), the estimated total cost of the import has been calculated at $622,528,656, equivalent to approximately Tk7672.66 crore. However, the actual expenditure may vary depending on fluctuations in international fuel prices and the exchange rate of the US dollar.

The proposal stated that the import cost will be financed from BPC's own funds and, if necessary, through loans or government support.

Global concerns and market situation

Referring to the global market situation, the BPC proposal said that international fuel prices have remained significantly high since March 2026 due to a new geopolitical crisis in the Middle East.

It said that because of security concerns in the Strait of Hormuz, vessels are using longer alternative routes, increasing transit time and operating costs. In addition, insurance companies are charging extra war-risk premiums and higher freight rates.

The proposal noted that the current situation is more complex than during the Russia-Ukraine war in 2022. While diesel prices reached a peak of $178.91 per barrel in 2022, they climbed to a record $284.95 per barrel on 2 April 2026. The average diesel price, which stood at $85.997 in February this year, rose by 118.50% to $187.904 in April.

Although the premium has increased somewhat due to global instability, BPC's tender evaluation committee considers the price obtained through open international competition to be reasonable under the prevailing circumstances.

No fuel shortage in the country

Officials of the Energy Division assured that there is currently no shortage of fuel oil in the country. Existing reserves are sufficient to meet demand for the next 60 days.

They said there is no risk of disruption in supply as the government has given priority to opening letters of credit despite the ongoing dollar shortage.

On the issue, Joint Secretary Monir Hossain told BSS, "There is no possibility of any disruption or crisis in the country's fuel oil supply chain."

Officials concerned at the ministry also said that an automatic pricing formula aligned with the international market is being implemented, which will provide long-term relief to consumers.

They added that work is also underway to expand the country's fuel storage capacity to address emergency situations. The government remains committed to ensuring uninterrupted fuel supply for the industrial and agricultural sectors under all circumstances.