Kazi Zahidul Hasan :
After months of strident calls from different quarters, the government has finally decided to cut the prices of petroleum products in line with the falling crude oil prices in the global market.
Earlier, it received scathing criticism from exporters, traders, transporters and the general public for not reducing fuel prices in the domestic market despite the international crude oil benchmark hit as low as $42.23 a barrel from over US$100 dollars few years back.
“The government has decided to cut prices of petroleum products to reflect international oil prices,” a senior Finance Ministry official told The New Nation on Friday, asking not to be named.
He said, “We have already received instruction from our Finance Minister in this regard. Prices of petroleum products are likely to be reduced soon.”
The official further said, prior to review of the fuel prices, the Finance Minister wanted to know the operating costs, profit margins and liabilities of the state-run Bangladesh Petroleum Corporation (BPC) and revenue board’s earnings from tax and VAT collection from BPC’s fuel import.
“The Finance Division of the Ministry has already sought such statements from BPC and other relevant organisations. It will later prepare a summary for Minister’s appraisal,” he added.
Responding to a question, the Finance Ministry official said, “Our minister might weigh all the pros and cons before making such a decision”.
The government is selling kerosene at Tk68 a litre, diesel Tk68, octane Tk99 and petrol at Tk 96. Their prices were fixed in January 2013.
Official sources said, BPC, the sole oil importer, is now making a whopping profit of Tk 13 to Tk 36 a litre on petroleum products on account of falling global oil prices.
In the last fiscal year, BPC has made a profit of Tk 5000 crore from the sale of fuel oils in the local market.
Global oil prices have already plummeted by more than 50 per cent over the past 20 months driven by a massive increase in supply by oil producing nations.
The International Energy Agency has predicted that the prices may further fall, with the new low rates lasting well into 2016.
“The government kept domestic oil prices high even though the collapse in prices in the international market, depriving consumers to get benefit of it,” Professor Dr M Shamsul Alam.
Energy Adviser, the Consumers’ Association of Bangladesh (CAB) told The New Nation yesterday.
He said, crude oil prices had been reduced consistently for more than one and half years and would continue to be reduced. So, there is no justification to keep petroleum prices at the same level.
Calling for an immediate cut in fuel prices in line with international prices, he said, the current high prices were robbing ordinary people and undermining business competitiveness in global market.
Dr Shamsul Alam opined that such a step will help to cut cost of doing business of local enterprises, raise their competitiveness, bring down inflation rate further and finally leave a positive impact on overall economy.
