Key Takeaways
- Bangladesh has increased fuel prices by up to 17.4% to offset rising global oil costs.
- The hike is expected to increase transportation and production costs, adding to inflation.
- The government aims to reduce losses and conserve foreign exchange reserves.
Bangladesh has raised fuel prices by up to 17.4%, effective from Monday, in a move to offset rising global oil prices and higher shipping costs linked to regional instability.
The new rates, which include a 17.4% increase in diesel prices to 135 taka per litre, are expected to raise transportation and production costs across the import-dependent economy.
The government has cited international fuel prices that have more than doubled since March 2026 and significant increases in freight charges as the primary reasons for the price hike.
The Energy Ministry stated that state-owned Bangladesh Petroleum Corporation incurred losses of 228.76 billion taka ($1.9 billion) between March and August, and that the latest price hike could cut annual losses by about 100 billion taka.
The hike is also aimed at conserving foreign exchange reserves and curbing fuel smuggling to neighbouring countries where prices are higher, the ministry added.
This latest increase follows fuel price hikes in April and June, when the government also raised prices to help offset rising import costs driven by higher global oil prices.
The ministry also highlighted substantial subsidies for liquefied natural gas, stating that the government has continued to support electricity and gas supplies despite higher import costs stemming from the regional energy crisis.
The move is expected to add to inflationary pressures, particularly in industries such as the country’s key garment export sector, which are already grappling with an acute energy crunch.
The government hopes that by raising fuel prices, it can mitigate the financial strain on the state-owned Bangladesh Petroleum Corporation and stabilize the economy.
