Govt approves Tk12,537cr oil imports from China, Indonesia

The government on Wednesday approved the direct purchase of refined oil worth Tk12,537 crore from state-owned companies in China and Indonesia to meet the country’s energy needs.

The Finance Ministry issued a notification in this regard, stating that the purchases would be made under a government-to-government arrangement. However, it did not specify the volume of oil to be imported.

Direct purchases are generally approved to ensure uninterrupted energy supplies during emergencies or unexpected disruptions in domestic or international markets. Continued disruptions around the Strait of Hormuz, coupled with renewed tensions between Saudi Arabia and the Houthis near the Bab al-Mandab Strait, have raised concerns over potential disruptions to key global energy routes and further volatility in oil prices.

The Cabinet Committee on Government Purchase (CCGP) approved the refined oil import plan at a meeting on Wednesday, while the Cabinet Committee on Economic Affairs (CCEA) gave its in-principle approval.

The CCEA also approved in principle the direct import of 6.95 lakh tonnes of gas oil and jet fuel.

Since August, the government has made several direct purchases of LNG and LPG to maintain energy supplies.

Under the existing policy, fuel imports are generally split equally between direct purchases and open international tenders, with each accounting for 50 percent of total imports.

However, officials decided on Wednesday to relax the rule, according to the Finance Ministry.

Under the latest arrangement, China’s state-owned companies Unipec and PetroChina, along with Indonesia’s BSP, will supply refined oil worth Tk12,537 crore to Bangladesh.