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DHAKA: Consumers in Bangladesh are being forced to pay Tk 500 to Tk 700 more than the officially fixed price for a 12kg liquefied petroleum gas (LPG) cylinder. Amid widespread overpricing, the Bangladesh Energy Regulatory Commission (BERC) is moving to increase commissions for importers, distributors and retailers, a move that could further raise the cost of cooking fuel for households.
BERC held a daylong public hearing on Thursday on proposals to increase LPG prices.
At the hearing, importers, distributors and retailers demanded higher commissions. After reviewing the proposals, BERC’s technical committee recommended an increase of Tk 139 per 12kg cylinder. If approved, the official price would rise from Tk 1,837 to Tk 1,976.
Although BERC has 60 days to announce its decision following the hearing, stakeholders have been asked to submit their opinions by next Sunday, leaving them just one working day to provide feedback.
BERC announced the hearing on October 14 following threats of strikes by distributors and retailers. The Consumers Association of Bangladesh (CAB) has accused the commission of rushing to increase prices without taking effective action against the sale of LPG above officially fixed rates.
Prices could rise further in November as part of the regular monthly adjustment. According to BERC and importer sources, higher international LPG prices and increased shipping costs alone could push up the price of a 12kg cylinder by more than Tk 100. If higher commissions are added, consumers will face an even greater financial burden.
BERC Chairman Jalal Ahmed, however, said the commission would make its decision after reviewing all opinions presented at the hearing. Speaking to journalists, he acknowledged frequent complaints about LPG being sold above the officially fixed price, although he noted that the product had sometimes also been sold below the prescribed rate.
He added that costs, including commissions, could be revised as they were last determined in 2021.
The LPG market has remained volatile for the past one and a half months. Prices were increased once in early October, but sales at higher-than-official rates have continued.
Of the 35 companies involved in Bangladesh’s LPG business, 23 have the infrastructure to import the fuel. However, only 10 companies imported LPG last month.
Currently, companies receive Tk 200 per 12kg cylinder to cover storage and bottling costs or commissions. Several companies have proposed substantial increases. Omera has proposed raising the amount to Tk 478, Petromax to Tk 349 and Delta to Tk 360. Meghna Group has proposed an increase to Tk 300.
Distributors have sought an increase in their commission from Tk 50 to Tk 150 per cylinder, while retailers have proposed raising theirs from Tk 45 to Tk 70.
Another proposal seeks to increase the commission on autogas, used as vehicle fuel, from Tk 8 to Tk 11 per litre.
The private sector accounts for 99 percent of Bangladesh’s LPG market, with around 80 percent of the fuel used for cooking. More than 10 million consumers depend on LPG.
BERC has been adjusting LPG prices every month since April 2021. However, consumers frequently have to pay more than the officially announced rates.
