Oil prices soar as Russia reduces production

The Government of Bangladesh has approved the procurement of various energy resources to ensure a stable supply. The Energy and Mineral Resources Division will procure one cargo of LNG from Vitol Asia Pte Ltd at a cost of approximately Tk708.55 crore.

On November 22, 2024, Bangladesh’s Advisory Council Committee on Economic Affairs approved in principle the operation and maintenance of the country’s first Single Point Mooring (SPM) with a double pipeline project under the direct purchase method (DPM). The Energy and Mineral Resources Division submitted the proposal, but detailed specifics will be reviewed during the upcoming Advisory Council Committee on Government Purchase meeting.

New studies from the South Asian Network on Economic Modeling (Sanem) reveal significant macroeconomic effects of energy price shocks in Bangladesh. A 10% rise in coal prices leads to a 0.3% increase in inflation, while LNG prices increase inflation by 0.2%. The studies also show that such price hikes cause depreciation in the taka, with a 10% increase in crude oil prices leading to a 0.16% depreciation.

The Centre for Policy Dialogue (CPD) introduced an Artificial Neural Network (ANN)-based model for fuel pricing on November 21, 2024, aimed at reducing costs by up to Tk 15 per litre through improved transparency, stopping pilferage, and adjusting taxes. The CPD study highlighted flaws in the automated pricing mechanism introduced in March 2024, citing lack of transparency and vulnerability to exchange-rate fluctuations.