Government Purchases LNG at Double Market Rates

The Bangladeshi government has moved to secure two urgent cargoes of liquefied natural gas (LNG) from the spot market at nearly double the usual price, in response to a global energy crunch exacerbated by the ongoing conflict in Iran. Despite existing long-term supply contracts with countries such as Qatar, deliveries have been delayed, prompting authorities to act to avert a potential domestic fuel crisis.

Spot Market Procurement Details

According to sources at Petrobangla, the purchase of the two LNG cargoes from the spot market will cost the government approximately BDT 2,300 crore, compared with BDT 1,100 crore for a similar shipment purchased last month. This represents an additional expenditure of roughly BDT 1,200 crore, highlighting the premium being paid to ensure timely delivery.

The Cabinet Committee on Purchase approved the rapid procurement during a meeting on Wednesday, citing the urgent need to maintain energy supply continuity.

Supplier and Pricing Information

A Petrobangla official provided further details:

One cargo will be purchased from the US-based Gunvor Group at $28.28 per MMBTU, amounting to BDT 1,279 crore—more than double the BDT 500 crore spent on a similar shipment in January.

The second cargo will be acquired from Vitol, priced at $23.08 per MMBTU, with delivery expected on 18 or 19 March.

The Gunvor shipment is anticipated to arrive in Bangladesh on 15 or 16 March.

Background and Supply Constraints

Petrobangla Chairman Erfanul Haque noted that while four LNG cargoes scheduled for March have already passed through the Hormuz Strait, two additional vessels—due on 15 and 18 March—remain delayed.

In response, Petrobangla initially issued two rounds of tenders on Tuesday and Wednesday for spot-market LNG purchases, but no suppliers participated. Consequently, the authority resorted to direct negotiation in the spot market to finalise procurement of the two urgent cargoes.

Financial Overview

Implications for Energy Security

The decision to purchase LNG at significantly higher rates reflects the urgency of maintaining uninterrupted domestic energy supply amid global shortages. Officials emphasise that while the cost premium is substantial, securing fuel is critical to avoid disruptions in power generation, industrial activity, and household energy availability.

Energy analysts note that the Bangladesh government’s move underscores the vulnerability of energy-importing nations to geopolitical tensions, supply chain disruptions, and rising international commodity prices. The coming weeks will test the efficiency of logistics and the ability to manage costs while sustaining national energy security.