The Bangladesh Energy Regulatory Commission (BERC) is set to reduce further retail prices of LPG in the domestic market today (Monday), considering the fall of Saudi Aramco contract price (CP) of the fuel for May 2021.
The commission is expected to virtually announce the new LPG prices for June, said a senior official.
The commission considers the Saudi Aramco CP as the benchmark for fixing LPG prices in the domestic market. It also considers fluctuations of foreign currency and change in the value added tax (VAT) amount to fix the domestic LPG prices.
The BERC lowered the domestic LPG prices last month by around 7.0 per cent for May, as the Saudi Aramco CP in April declined to US$560 per tonne for propane and $530 per tonne for butane from March's $625 and $595 respectively.
The Saudi Aramco CP in May dipped further to $495 for propane and $475 for butane, according to international market sources, making inroads for further drop in LPG prices in the domestic market.
As per the BERC verdict, the current retail price of a 12-kg LPG cylinder, provided by private operators, is Tk 906.
The retail price of a 12.5-kg LPG cylinder, provided by the state-run LP Gas Ltd, is Tk 591.
Retail price of auto gas, the LPG used in vehicles, is Tk 44.70 per litre.
BERC Chairman Md Abdul Jalil sought cooperation last month from all concerned, including the relevant ministries, departments and administrative authorities, to implement the commission's decision on new LPG prices.
Bangladesh imports around 95 per cent of its total LPG requirement from global sources, while LP Gas Ltd produces around 20,000 tonnes of LPG after refining from crude oil and condensate.
The country usually imports pressurised LPG in coaster-type vessels with a capacity of about 1,800 tonnes delivered to Mongla Port from trading sources, such as Singapore, or the nearest deep sea-ports where large ships can anchor and break bulk. Its main LPG suppliers include Siam Gas, BB Energy, Vitol Asia and Petredec.
More than 25 LPG companies, of varying size and investment, are now operating in the local market.
LPG consumption in Bangladesh has risen to around 1.5 million tonnes per year now from around 1.0 million tonnes in 2018.
The country consumed almost 650,000 tonnes of LPG in 2017, around 400,000 tonnes in 2016, and 250,000 tonnes in 2015.
