The government spent an additional amount of US$344.5 million on oil imports during last fiscal 2005-06, mainly because of the hike in the prices of the same in the international market.
According to Bangladesh Bank (BB), the government imported petroleum and petroleum products worth US$1928.17 million in the fiscal 2005-06 as against that of US$1573.68 million in the previous fiscal 2004-05.
The prices of oil in the international market have been on the rise during the last couple of years. It has gone further up last month following the Israeli attack on Lebanon and the tension over Iran's nuclear programme.
Due to the volatile international oil market, the country spent additional money worth $344.5 million in last fiscal over the previous fiscal with the quantity of fuel imports remaining same.
According to the Energy and Mineral Resources Ministry, the state-owned Bangladesh Petroleum Corporation (BPC) imported some 3.8 million metric tonnes of petroleum and petroleum products last fiscal as against 3.76 million metric tonnes of the previous fiscal, 2004-05.
A high official in the Energy Ministry admitted that higher payments against oil imports had put the government in financial difficulties
He said that the ministry is desperately looking for funds to finance future oil imports. "The country's present oil stock will be able to meet the demand for the same until October next. So it is imperative to import more fuel within two to three months to build up a stock enough to meet the demand until January next year," the official said.
According to Energy Ministry sources, the government is trying to reach an agreement with the Kuwait government for oil import under deferred payment arrangements but it is yet to be settled. "Though the Kuwait Petroleum Corporation (KPC) has agreed to export petroleum to Bangladesh on deferred payment, the central bank of Kuwait did not agree to do so," the sources added.
Meanwhile, the Energy Ministry has sought US$225 million credit from the HSBC to finance oil imports. The BPC has already taken US$250 million loan from the Standard Chartered Bank to make payment against oil import bills.
The country's monthly oil consumption varies from 0.22 million tonnes to 0.28 million tonnes. Of this, monthly consumption of diesel alone is between some 0.16 million tonnes and 0.2 million tonnes. In order to offset the loss in oil sector the government raised the prices of fuel oils on June 9 last.