Staff Reporter :
In response to persistent overpricing by distributors, the government is preparing to sell liquefied petroleum gas (LPG) produced by the Bangladesh Petroleum Corporation (BPC) directly to consumers, official sources have confirmed.
Currently, a 12-kg LPG cylinder from private suppliers retails at Tk1,431, while BPC’s 12.5-kg cylinder has an official price of Tk825. However, consumers frequently pay between Tk1,000 and Tk1,350 for BPC cylinders due to excessive mark-ups by distributors.
“BPC supplies each cylinder to distributors at Tk784, yet they charge consumers significantly more-sometimes up to Tk450 over the fixed price,” a BPC official stated, speaking on condition of anonymity. He noted that this pricing disparity undermines government efforts to keep LPG affordable, particularly for households without access to piped gas.
Distributors argue that the allocations from BPC are insufficient and that adhering to the official price is unsustainable once operational costs-such as shop rent and licensing fees-are factored in.
In light of these challenges, BPC is preparing a policy to bypass intermediaries and supply LPG directly to end-users.
“We aim to deliver LPG directly to households, particularly in areas lacking piped gas connections,” BPC Chairman Md Amin Ul Ahsan said. “The Ministry of Energy has approved distribution in districts such as Sylhet, Bhola, Brahmanbaria, Jamalpur, and Begumganj. State-owned gas companies will handle delivery under district administration oversight. Implementation is expected to begin within two months.”
Energy Adviser Fouzul Kabir Khan echoed the initiative, stating, “Our priority is to ensure that the benefits of subsidised LPG reach consumers directly. That’s why the distribution process in gas field areas will be brought under government control.”
BPC’s LPG is a byproduct of crude oil refining at Eastern Refinery Limited (ERL), and is bottled and packaged by the state-owned LP Gas Ltd at plants in North Patenga (Chattogram) and Golapganj-Kailashtila (Sylhet).
Distribution is managed through BPC’s four subsidiaries-Padma Oil Company Limited, Meghna Petroleum Limited, Jamuna Oil Company Limited, and Standard Asiatic Oil Company Limited-via a network of 3,101 registered distributors.
However, BPC’s total annual output of 12.5kg cylinders is just 120,000 to 130,000 units, accounting for only around 1.66 per cent of national demand. Due to this limited supply, distributors receive small allocations, which are often sold at inflated prices.
BPC currently lacks a dedicated enforcement mechanism and must rely on external law enforcement for regulatory oversight.
While not directly admitting to overpricing, Khorshed Ur Rahman, President of the LPG Distributors Association in Chattogram, acknowledged that limited supply poses significant challenges.
“With such small allocations, it is difficult to meet market demand and cover our operational expenses,” he said. He also criticised LP Gas Ltd for its ageing infrastructure, noting that many of its cylinders are outdated and that no serious effort has been made to modernise or expand its facilities.
An internal BPC investigation recently confirmed the overpricing issue. The report concluded that the existing distributor appointment and marketing frameworks are outdated and in urgent need of reform. It also recommended narrowing the price gap between government-supplied and privately-supplied LPG to reduce market distortions.
To improve affordability and transparency, the report proposed selling LPG cylinders directly through government depots or designated sales centres, using a customer card system to monitor purchases and prevent misuse.
