State Minister for Power, Energy and Mineral Resources Nasrul Hamid has indicated that the price of petroleum fuel may witness a decline with the application of the government-announced guideline for introducing their automated prices.
"We’re waiting for the approval of the Prime Minister for the guideline... If we can apply the guideline within the first week of March, we’ll hopefully see a decline in the price,” he told reporters.
The government on Friday issued a “Fuel Pricing Guidelines” through a gazette notification to set an automated price for petroleum fuels across the country. It said the system will be effective from March.
Under the guidelines, prices of all petroleum fuels including petrol, diesel, octane, kerosene, furnace oil, jet fuel, marine fuels will be set automatically on the basis of the international market price.
Nasrul Hamid said the government’s main priority is the adjustment in the price of diesel as the most consumption comes from this petroleum product.
He noted that from now on every month there will be adjustment in fuel prices. “If we seek, the price declines in the global market, local consumers will benefit from it. Now the prices of fuel are at an economic level.”
He also said the local prices will go up and down in line with the international price and every month such prices will be announced by the government for one-month tenure.
Immediately after issuing the guideline on Friday, Energy Secretary Md Nurul Alam had said that it won't be effective from today (from March). “Since we have not yet received the Prime Minister’s approval to make the guideline effective, we’ve to wait for some more days,” he said.
“We hope we'll get the PM’s approval soon and will bring it into effect within 10-12 days,” he told UNB.
The Fuel Pricing Guidelines, however, giving an example for its effectiveness said that if it is planned to make effective from April 1, the prices of fuels of one month in the international market from February 21 to March 20 has to be taken into consideration to set an average price and then set the price for month of April.
About such contradictory instructions in the guideline, the energy secretary said that such an automated pricing system is a new thing in Bangladesh. So, the ministry itself is in some confusion.
“We’ll sit with the Bangladesh Petroleum Corporation (BPC) to remove all confusions and make the guideline clear to all,” he said. The BPC is the state agency for importing and marketing of petroleum products across the country.
In case of setting a price for any of the petroleum fuels, all the expenses including the international market price, import tax, advance income tax and valued added tax (VAT), operational expense, finance, administrative and maintenance cost, margins of BPC, VAT, and sale and distribution costs will be taken into account and then set a price.
A source in the Energy Division said that the price of octane will go below the price of diesel as soon as the automated pricing formula is effective.
“This is also a big concern for the government”, he said, adding that the government wants to keep the octane price higher than diesel,” he added.
