LOAB explains reasons behind LPG price hike in Bangladesh

The Bangladesh Energy Regulatory Commission (BERC) has explained the reasons behind the recent increase in liquefied petroleum gas (LPG) prices in the domestic market. The regulatory body stated that the price adjustment was necessitated by a rise in Saudi Aramco's LPG contract prices internationally.

Reasons behind the price hike

In a press release issued on Thursday (November 12), the Bangladesh Energy Regulatory Commission (BERC), commonly known as LOAB, said the new LPG prices were determined considering the international market situation and Saudi Aramco's announced prices. The commission noted that the decision aligns with fluctuations in global fuel prices.

According to BERC sources, Bangladesh determines its LPG prices based on the monthly Contract Price (CP) announced by Saudi Aramco. As the CP increased in November, its impact has been reflected in the domestic market.

Impact on consumers

Under the new pricing, the cost of a 12 kg LPG cylinder has increased compared to the previous month. Analysts believe this will add further financial pressure on ordinary consumers. However, LOAB maintains that the adjustment was made in line with international market trends, describing it as a standard procedure.

Meanwhile, consumer rights organizations have expressed concern over the price hike. They argue that the purchasing power of consumers should be taken into account during fuel price adjustments.

Monthly adjustment mechanism

It is worth noting that LPG prices in Bangladesh have been adjusted on a monthly basis since 2023. BERC announces new prices on the first day of each month, aligned with Saudi Aramco's CP. The November prices were set under this existing mechanism.

Market stakeholders suggest that if volatility persists in the international market, further price fluctuations may be observed in the coming months.