BERC seeks urgent action to stabilise LPG market before Ramadan

Highlights:

• BERC warned of possible LPG supply disruptions ahead of Ramadan and urged urgent coordination to import 150,000 tonnes of LPG to stabilise the market.

• LPG prices have surged and supply has tightened across the country, with consumers reportedly paying nearly double the government-fixed rate in some areas.

• Industry leaders cited regulatory weaknesses, banking constraints and market concentration as key reasons behind the ongoing LPG market crisis.

Bangladesh Energy Regulatory Commission (BERC) Chairman Jalal Ahmed today (15 January) expressed optimism that increased liquefied petroleum gas (LPG) imports would help avert a supply crisis during Ramadan, stressing the need for urgent coordination among regulators, importers and other stakeholders to stabilise the market.

Speaking at a roundtable titled “Regulatory Challenges in the LPG Market” at a city auditorium, he said importing around 150,000 tonnes of LPG in January and ensuring delivery in February would be crucial to maintaining adequate supply.

“If this volume is imported on time, we believe it will be possible to prevent a supply disruption during Ramadan,” Jalal Ahmed said.

The discussion was jointly organised by the LPG Operators Association of Bangladesh (LOAB) and Energy & Power magazine.

Acknowledging the ongoing turmoil in the LPG market, the BERC chairman said the current crisis has largely stemmed from supply-side constraints. He said BERC would implement reforms within its jurisdiction and engage relevant agencies on issues beyond its authority.

Over the past several days, LPG prices and availability have seen severe volatility. In many areas, LPG has reportedly been unavailable even at nearly double the government-fixed rate, raising concern among consumers ahead of Ramadan.

A H M Shafiquzzaman, president of the Consumers Association of Bangladesh (CAB), questioned the pricing mechanism. “Why should consumers pay Tk2,500 for LPG that is officially priced at Tk1,300?” he asked. He called for greater transparency in price-setting and urged the government to declare LPG an essential commodity. He also said government agencies should not be directly involved in LPG business operations.

Jalal Ahmed said companies that imported additional LPG did not face major obstacles. He noted that LPG imports have declined in recent months due to international and domestic factors but expressed hope that supply would normalise soon.

Prof M Tamim, vice chancellor of Independent University, Bangladesh, presented the keynote paper. He said the LPG sector suffers from weaknesses in its regulatory structure and called for a unified regulatory framework. He noted that the crisis has deepened even as LPG use continues to rise rapidly.

According to M Tamim, Bangladesh’s annual LPG demand stands at around two million tonnes and is projected to reach 3.5 million tonnes in the near future.

Deputy Director of the Department of Environment Shamsuzzaman Sarkar said LPG bottling plants have been shifted from the red category to the yellow category. He added that the government plans to declare the LPG industry a green industry and that environmental clearance would be issued within seven working days.

BNP leader Zahir Uddin Swapan said every government should have a clear plan for energy sector expansion, prioritising public interest. He also suggested easing excessive administrative controls to improve LPG availability.

LOAB President Aminul Haque said the LPG sector is passing through a critical phase due to challenges in international and local markets. “Unless regulatory bottlenecks are removed, new investment will not come,” he said.

Delwar Hossain, deputy general manager of Jamuna LPG, said the ongoing financial crisis and limited banking support have made it difficult for importers to open LCs and secure LPG shipments.

Industry representatives also raised concerns over market concentration and pricing challenges. Shahjahan Shaju of Universal Gas said only six operators dominate the market while smaller players struggle to compete. Sakib Ahmed Siddiqui of Unitex LP Gas said operators are forced to buy LPG at high prices, making it impossible to sell at regulated rates.

Abu Sayed Raza of Meghna Fresh Gas called for a rational pricing structure. Belayet Hossain of Jamuna Space-Tech cited political, economic and import limit-related hurdles. JMI Chairman Abdur Razzak warned that only five out of 27 operators currently have the capacity to import LPG, cautioning that continued imbalance could destabilise the entire market.

The roundtable was moderated by Mollah Amzad, editor of Energy & Power magazine.