Bangladesh secures diesel supplies amid major energy disruptions
- Bangladesh getting new diesel cargoes amid a Middle East fuel crunch
- One month’s supplies secured, with another being arranged
Bangladesh has begun receiving diesel from suppliers including China and India, with officials saying the country now has enough fuel to cover about one month of demand, with arrangements under way for another month, after the U.S.-Israeli war on Iran disrupted shipments, including to the massive garments industry.
The South Asian nation of 175 MM people, which relies on imports for roughly 95% of its energy needs, has imposed fuel rationing for vehicles, restrictions on diesel sales and closed universities as the war on Iran causes severe disruption to Middle East oil exports.
Some garment makers in Bangladesh, the world’s second‑largest clothing exporter after China, have already complained they do not have enough diesel to run their back-up generators when public utilities cut power supplies.
Mahmud Hasan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association, said power cuts had doubled to up to five hours a day since the war began on February 28.
"When power goes out, we have to run our standby generators on diesel, but we can’t buy enough diesel anymore, and it’s causing problems for us," he said.
State-run Bangladesh Petroleum Corporation (BPC) is receiving around 60,000 metric tons (t) of diesel from three traders, with a further 90,000 t scheduled to arrive later this month, two energy officials said, requesting anonymity because they were not authorized to speak to the media.
A 27,000-t diesel cargo from PetroChina arrived at Chittagong port on Monday, while a cargo of 28,000 t from Vitol is waiting at the port’s outer anchorage, a BPC official said.
In addition, around 5,000 t of diesel is being supplied through a cross-border pipeline from India’s Numaligarh Refinery. Officials said talks are ongoing to secure some 30,000 t from Indian Oil.
"We have supplies for one month, and another month is being arranged,” a BPC official said.
Bangladesh normally needs about 380,000 t of diesel each month, but officials said that since rationing began, one estimate put current monthly requirements at roughly 270,000 t.
Officials said securing refined fuel cargoes had been relatively easy because most of the traders did not rely on the disrupted Gulf shipping routes used for crude oil shipments.
However, prices have increased as a result of the intense market volatility triggered by the Middle East crisis, they added.
Bangladesh also imports around 1.4 MMt of crude oil a year for its refineries under long-term contracts with Saudi Aramco and Abu Dhabi National Oil Company (ADNOC).
However, supplies from Saudi Aramco and ADNOC could be affected because their crude shipments to Bangladesh must pass through the Strait of Hormuz. One Aramco cargo of about 100,000 t has already been delayed in the Gulf due to the ongoing crisis, officials said.
Severe gas shortages have already forced Bangladesh to halt operations at four of its five state‑run fertiliser factories, redirecting available gas to power plants.
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