Fuel Import: Supply stable, risks remain

Uncertainty continues to surround the country’s fuel imports as escalating tensions in the Middle East threaten one of the world’s most critical energy corridors, raising concerns over possible delays in crude oil and liquefied natural gas (LNG) shipments.

Energy officials say the situation is closely monitored, particularly in the Strait of Hormuz, a narrow maritime route through which a significant share of global oil passes. Any disruption could directly affect import-dependent countries like Bangladesh.

Despite these concerns, the government maintains that there is no immediate risk of a severe supply crisis, pointing to efforts to diversify sources and secure alternative shipments.

Recent tensions involving Iran have raised fears of delays, although Iran’s ambassador to Dhaka, JalilRahimiJahanabadi, has assured that Bangladeshi fuel shipments will be allowed safe passage.

“We are watching developments very carefully,”an energy ministry official told the media. “Even if there is no immediate disruption, the risk factor remains high.”

To ease pressure on domestic supply chains, Bangladesh has imported 45,000 tonnes of diesel from India in March through cross-border arrangements, with an additional 300,000 tonnes secured through direct government-to-government deals. Further diversification includes sourcing supplies from Singapore, Malaysia, China, and India, while around 120,000 tonnes are expected from Brunei as part of contingency planning.

State Minister for Power, Energy and Mineral Resources Anindya Islam said, “We are now importing fuel from multiple sources. Therefore, there is no immediate concern about a major fuel shortage.”

Bangladesh’s fuel import profile provides some resilience. About 80 per cent of imports are refined petroleum products, which can be used directly, sourced from countries including Malaysia, the UAE, China, Indonesia, Thailand, India, Oman, and Kuwait. The remaining 20 per cent consists of crude oil, primarily from Saudi Arabia and the UAE, processed domestically at Eastern Refinery Limited. During FY24–25, the country imported approximately 4.7 million tonnes of refined fuel worth Tk 396.92 billion and 1.51 million tonnes of crude oil worth Tk 105.03 billion. Eastern Refinery contributed nearly 1.5 million tonnes of petroleum products, including 750,000 tonnes of diesel.

As of early March, diesel stocks stood at over 115,000 tonnes, with additional shipments already scheduled.

Earlier this month, panic buying triggered by fears of global supply disruption led to a surge in consumption, prompting a nine-day rationing of petrol, octane, and diesel. Although rationing has been lifted, demand remains high, and filling stations are still adjusting. Industry insiders say the recent strain was driven more by consumer behaviour than actual supply shortages.

“Panic buying created an artificial spike in demand,” said one industry source. “The system is stabilising, but it will take time for confidence to return.”

However, uncertainties remain. Shipping schedules could be affected if Gulf tensions escalate, particularly if insurers raise premiums or vessels are rerouted.

Such developments could increase import costs and delay deliveries even when supplies exist.

Fuel is crucial for transport, agriculture, and industry. Prolonged disruptions could impact supply chains, industrial output, and overall economic activity. Transport operators have already reported difficulties in maintaining schedules, while industries remain cautious about potential shocks.

Officials remain cautiously optimistic. “With diversified sourcing and ongoing imports, we are in a manageable position,” said the state minister. “Even if crude shipments are delayed, we have alternatives.”

Still, the situation highlights Bangladesh’s dependence on global energy markets and the risks inherent in that reliance.