Consumption of furnace oil peaks up after easing of the nationwide as electricity generation is on rise to meet the mounting domestic demand.
The country expects to import around 280,000 tonnes of furnace oil in August, up by 12 per cent than in July due to strong demand from its power sector, industry sources said recently.
“Import may be around 280,000 mt in August, up from around 250,000 mt in July, as the country is coping with the 'new normal' during the coronavirus pandemic,” president of Bangladesh's Independent Power Producers' Association, or BIPPA, Imran Karim told the FE Monday.
Electricity demand has been increasing in the country with the easing of lockdown restrictions.
It has almost doubled its furnace oil import since June to around 220,000 tonne per month, compared with 100,000 tonne per month in April and May, as businesses resumed operations, albeit limited in scale, following the three-month long lockdown due to the coronavirus pandemic, Karim said.
The country's import of furnace oil is expected to increase steadily into September, he added.
Bangladesh imported around 3.2 million tonne of furanc oil during the fiscal year, or FY, 2019-20, of which 2.90 million tonne were imported by the private sector to run their power plants, while the remaining 300,000 tonne by state-run Bangladesh Petroleum Corporation, or BPC.
The country's furnace oil import in FY2019-20 is almost similar to its import during FY2018-19, Karim said.
Bangladesh has around 5,700 MW capacity HSFO-fired power plants, of which 4,500 MW capacity HSFO-fired power plants are owned by the private sector, while the remaining 1,200 MW capacity is publicly-owned.
Due to lower than expected consumption and lack of available tank space of furnace oil the country’s lone crude oil refinery Eastern Refinery Ltd, or ERL was shut for a week in June.
The Country’s furnace oil consumption fell drastically due to the coronavirus pandemic and the resultant lockdown, from March 26 to May 30, restricted almost all types of transportation including air, rail, public transport as well as movement of private vehicles with the exception of some critical travel services being offered during this period.
Consumption of furnace oil, a leading product from the ERL, had plunged due to limited operations of state-owned furnace oil -fired power plants during the lockdown.
As a consequence, BPC had to cancel one 100,000 tonne Murban crude oil term cargo from Abu Dhabi National Oil Company, or ADNOC, in June.
