The government announced the largest ever hikes in the price of fuel oils - ranging from 42- 52 percent - that became effective as of midnight Friday (technically 0000 hrs Saturday).
At the consumer level, the retail prices of diesel and kerosene will be Tk114 per litre, up by a whopping 42.5% from Tk 80/litre, the price set last November following a 23% hike from Tk 65/litre.
But the 42.5% hike even exceeds the 37.5% hike in price from 2007, when it went up from Tk 40 to Tk 55 - the largest hike on record prior to tonight.
Octane will cost Tk135 per litre, up an eye-watering 51.7% from Tk 89/litre - again the largest hike on record.
Lastly a litre of petrol will set consumers back by Tk130 from now at the pump, that used to be Tk 86/litre even just a few hours ago as of writing this report - another 51% hike in one go that has no precedent in independent Bangladesh.
The Bangladesh Petroleum Corporation (BPC) and Eastern Refinery Limited (ERL) have adjusted the petroleum fuel prices as the prices are much higher in the international market compared to Bangladesh, the Energy Division said Friday.
State Minister for Power, Energy and Mineral Resources Nasrul Hamid said "The government avoided increasing the prices of fuel oils for as long as it could. Now some adjustments have to be made taking stock of the current global situation."
He offered some hope that the prices may be adjusted back down if the situation in the international energy markets shifts to allow that. But this rarely, if ever, happens. Nasrul Hamid harked back to the one occasion it happened under him, by very small amounts, when prices hit rock bottom internationally in the midst of a prolonged slump in prices that only turned around with the most recent rally in energy markets.
"In April 2016, the government reduced the prices of fuel oils. If the situation normalises, the prices of fuel oils will be revised accordingly," he said.
Nasrul said due to the upward trend in fuel prices in the global market, many countries have been regularly making adjustments to prices. It would seem the government has chosen to gain parity with prices in the neighbouring Indian state of West Bengal.
West Bengal government in India set the price of diesel at Rs92.76 per litre and petrol at Rs106.03 per litre in Kolkata on May 22, 2022 - these prices remain in effect today, and work out to Tk114.09 (diesel) and Tk130.42 (petrol), at an exchange rate of Rs1 =Tk1.23.
Also, the BPC is already running a loss of Tk8,014.51 crore in petroleum fuel sales in the last six months, from February to July.
Considering the global oil market situation, making "rational price adjustments" became essential to continue BPC as a going concern, while tasked with the vital function of overseeing petroleum imports, among other things.