No fuel price hike now, govt monitoring Iran-Israel conflict: Finance adviser
“Prices have already risen somewhat, but it has not affected the shipments we have ordered. If the war continues for a long time, then there will be an impact or pressure on us,” says Salehuddin Ahmed
The government has decided not to revise domestic fuel oil or other energy prices upward for now, despite the rising trend in global crude price due to the Israel-Iran conflict, Finance Adviser Salehuddin Ahmed said today (17 June).
"We are monitoring the Iran-Israel war. We have already seen a slight increase in fuel prices. However, the orders we have placed have not been affected yet. But if the war continues for a longer period, it may have an impact or create pressure on us," he said after the 23rd meeting of the Cabinet Committee on Government Purchase at the Secretariat.
He added that despite rising global prices, the government will "wait a bit longer" before considering a domestic price hike.
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When asked about international trade, Salehuddin said, "For now, there will be no impact on trade," implying supply chains remain stable.
The government is also taking steps to secure essential imports. Salehuddin, "As for special preparations, today we approved proposals to import LNG and fertiliser at old prices. In the future, when we bring in new shipments, there may be some impact.
"The Ministry of Energy is certainly considering alternatives, since our entire fuel supply depends on imports. The war will not only affect fuel but also fertiliser and shipping. Ships pass through the Strait of Hormuz, and that could be affected. However, I don't think the war will last long."
Approval for one LNG cargo purchase
Amid global energy market instability, the Cabinet Committee on Government Purchase approved buying one LNG cargo from the spot market, scheduled to arrive between 15 and 16 July. This brings the total approved LNG cargoes for 2025 to 30.
Salehuddin confirmed the LNG import was secured at the "old price," saying, "We are fortunate to still be getting it at the previous rate."
The shipment will be supplied by American company M/S Excelerate Energy LP at $14.94 per MMBtu (Metric Million British Thermal Units), costing the government over Tk612.54 crore for 3.36 million MMBtu. The decision followed a lower price offer from Excelerate compared to a bid from M/S TotalEnergies Gas & Power Ltd, UK.
Alongside LNG, the committee approved purchasing 30,000 tonnes of bagged granular urea fertiliser from Karnaphuli Fertilizer Company Limited. The deal, under the 17th lot of the fiscal year and facilitated by the Bangladesh Chemical Industries Corporation, will cost around Tk140.27 crore, with each tonne priced at $383.25.
New building on Latif Bawany Jute Mill land
In another decision, the government agreed to build a multistorey residential and commercial building on 1.97 acres of state-owned land at the Latif Bawany Jute Mill in Mymensingh. Production at the mill has been suspended since 2020.
The project will be carried out under the Public-Private Partnership (PPP) model, as approved by the Cabinet Committee on Economic Affairs today.
