Govt unlikely to cut oil prices, hints PM
Prime Minister Sheikh Hasina has hinted that oil prices may not go down in the country as the government still needs to redeem a huge amount of losses that was incurred while paying subsidies for oil imports. The comment of the prime minister overshadows the words of hope recently given by Finance Minister AMA Muhith that oil prices might be reduces in line with the falling prices of fuel oil in the international market. Sheikh Hasina, during a meeting yesterday with a delegation of the newly elected office bearers of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said the government had to purchase fuel at a higher price previously for power generation, for which it had to incur a liability of Tk 38,000 crore. Out of that liability, only Tk 8,000 crore has so far been paid. The losses of the Bangladesh Petroleum Corporation (BPC) should be redeemed by keeping the prices unchanged, she said.
The newly elected directors body of the FBCCI made a courtesy call on the PM on Thursday and brought the issue of oil prices in the meeting. Sheikh Hasina said while many claim that the prices of oil have not been reduced despite dips in international markets, the government bears the liability for the huge amount of subsidies given earlier for oil imports.
When the prices of oil were sky high in the international markets, the government had to subsidise to sell them at a lesser costs in the local markets. We had to buy in higher prices and sell them locally in lower prices. The result? Liability of Tk. 380 billion, the PM said during the meeting.
As the prices have decreased in the international markets, the government can now make some profits. We can slowly repay the huge debts now. Still there remains a loss of Tk. 290 billion for the BPC. Till now, we have only managed to pay back Tk. 80 billion, the PM told the FBCCI leaders.
Prices of fuel oil were last raised on 2013 to keep the markets in sync with the international ones. The prices of Octane, Petrol, Kerosene and Diesel stood at Tk. 99, Tk. 96 and Tk. 68 both respectively. While the finance minister, before increasing gas and electricity prices, had said that the government has plans to review oil prices in September, Planning Minister AHM Mustafa Kamal on Wednesday, also took stance against the plan to reduce oil prices. The planning minister said that the prices of oil in the international markets might rise again anytime and the government then has to increase the prices again.
