The growing disparity has raised questions about market competition, supply-chain management and the effectiveness of regulatory oversight. Distributors accuse some LPG companies of charging excessive prices from the factory itself, while importers blame distributors and retailers for inflating prices at the consumer end. Allegations of artificial shortages and market manipulation have added to concerns.
Bangladesh consumes more than 1.8 million tonnes of LPG annually, with over 10 million customers relying on the fuel, particularly for household cooking. Yet almost the entire market is controlled by private companies, and a relatively small number of major operators dominate imports.
During the 2025-26 financial year, seven companies accounted for 86 per cent of total LPG imports, while five of them alone controlled approximately 71 per cent. Industry concentration on this scale has raised concerns about limited competition and the possibility of coordinated market behaviour.
The situation has become particularly difficult for households as the Bangladesh Energy Regulatory Commission (BERC) has increased the regulated price considerably over recent months. Between March and November this year, the official price of a 12kg cylinder rose by 53.6 per cent. Despite these adjustments, consumers continue to struggle to obtain LPG at the approved rate.
Five opposition MPs submitted a notice seeking an urgent discussion in Parliament last Monday over the rising cost of LPG. They alleged that prices were being revised without adequately consulting consumers and other relevant stakeholders. They also called for greater transparency in the price-setting process and stronger monitoring of the market.
Professor Shamsul Alam, energy adviser to the Consumers Association of Bangladesh (CAB), told Samakal that the LPG sector had effectively been left entirely to private businesses.
He alleged that companies were exploiting their market position to increase prices, while BERC was failing to adequately protect consumer interests. According to him, repeated price increases under pressure from businesses, combined with weak market supervision, were making cylinder gas increasingly unaffordable for ordinary people.
However, Belayet Hossain, managing editor of Jamuna LPG, offered a different explanation. He said there was a worldwide shortage of raw materials and that companies were supplying all the LPG they managed to import. Holding imported cargo in storage was not commercially viable, he argued, because ships remaining at ports incurred additional charges and penalties.
Prices have risen by 53.6 per cent
The increase in LPG prices over the past nine months has been substantial. In March, BERC had fixed the price of a 12kg cylinder at Tk 1,341. By November, the regulated price had climbed to Tk 2,060.
The increase amounts to Tk 719, or 53.6 per cent. In November alone, the price was raised by Tk 223.
Yet consumers say the official price has rarely reflected the amount they actually pay at retail outlets. A 12kg cylinder has commonly cost Tk 200 to Tk 300 above the regulated rate. The additional expense has been even greater for households using larger cylinders.
Over the past five to six months, some consumers have reportedly had to spend Tk 500 to Tk 800 more than the government-approved price, depending on the cylinder size and local market conditions.
For households that depend on LPG for daily cooking, these additional costs have become a recurring financial burden. Unlike occasional purchases, cooking gas is an essential household expense, making sustained price increases particularly difficult for families with limited incomes.
Distributors and importers trade accusations
The dispute over excessive retail prices has exposed serious disagreements within the LPG supply chain.
Distributors argue that some companies are selling cylinders from their factories at prices well above the rates approved by BERC. A representative of the distributors’ association alleged that certain companies were charging as much as Tk 2,300 for a 12kg cylinder at the factory level while recording only Tk 1,905 on invoices or sales documents.
If such practices are taking place, distributors say, they have little choice but to purchase cylinders at higher prices and pass the additional cost on to retailers and consumers.
The LPG Business Cooperative Association submitted a formal complaint to the BERC chairman on 21 September. It alleged that operator companies were charging dealers more than the commission-approved prices.
The organisation also complained that enforcement operations by mobile courts were disproportionately targeting small businesses at the retail level, while the alleged pricing practices of larger companies were not receiving comparable scrutiny.
Importers have rejected these accusations, instead blaming distributors and retailers for forming their own arrangements to charge excessive prices.
The LPG Operators Association of Bangladesh (LOAB) maintains that operators are supplying gas at the prices fixed by BERC. According to the organisation, the additional charges are being imposed further down the distribution chain.
An official from the Energy Division suggested that the structure of the supply chain itself could be contributing to higher prices. Several major companies import LPG and sell it to other operators, which then add their own profit margins before distributing the product.
As a result, multiple layers of commercial margins accumulate between the original importer and the final consumer.
BERC chairman Jalal Ahmed said the commission had received information that some retailers were purchasing cylinders through intermediaries rather than directly from importing companies. This additional layer of transactions was pushing up prices, he said, adding that the commission was examining the matter.
Investigations into alleged artificial shortages
Allegations that some companies are deliberately restricting supplies to create artificial shortages have prompted government and regulatory investigations.
On 30 September, Energy Minister Iqbal Hasan Mahmud instructed deputy commissioners across the country to investigate reports of artificial LPG shortages and sales at excessive prices. They were asked to submit reports supported by evidence.
However, the Energy Division has yet to complete a comprehensive report on the matter.
A recent report by the National Security Intelligence (NSI) agency also raised allegations against five leading LPG companies, accusing them of restricting supplies. The agency recommended investigations into the allegations.
Against this backdrop, BERC began examining import and sales records to establish whether companies were releasing imported LPG into the market in accordance with their reported volumes.
On 3 October, the commission sent letters to 12 importing companies requesting details of their imports and actual sales during September.
According to BERC sources, 11 companies submitted their responses by 4 October. However, significant discrepancies emerged between the companies’ sales figures and the import records maintained by the National Board of Revenue (NBR).
Several companies reportedly declared sales volumes substantially lower than their respective import quantities. This raised suspicions that imported LPG might have been held in storage rather than released into the market, potentially contributing to artificial shortages.
BERC subsequently issued show-cause notices to four companies, asking them to explain the discrepancies in their accounts.
Sources said the commission’s monitoring had also forced several companies that were charging above the regulated price to reduce their selling rates.
The Energy Division has separately instructed operators to increase imports to improve market availability. At a meeting with representatives of 24 operators at the ministry on 9 November, companies were asked to prepare to import at least 200,000 to 250,000 tonnes of LPG every month before February.
Five companies dominate imports
Bangladesh has 35 licensed LPG businesses. Of these, 23 have import authorisation and the necessary infrastructure to bring the fuel into the country. During the 2025-26 financial year, 16 companies imported LPG.
BERC data show that total imports during the financial year amounted to 1,743,695 tonnes.
Five companies—United Aygaz, Meghna Fresh LPG, Omera Petroleum, BM Energy and Jamuna Spacetech—accounted for approximately 1.231 million tonnes of those imports.
LPG import concentration, 2025-26 financial year
| Indicator | Volume or share |
|---|---|
| Total LPG imports | 1,743,695 tonnes |
| Imports by five leading companies | Approximately 1.231 million tonnes |
| Share controlled by five companies | Approximately 71% |
| Share controlled by seven companies | Approximately 86% |
| Number of licensed LPG businesses | 35 |
| Companies with import authorisation | 23 |
| Companies that imported LPG | 16 |
| Monthly domestic demand | More than 150,000 tonnes |
| Imports in August | 157,760 tonnes |
| Imports in September | Approximately 156,000 tonnes |
The figures indicate that a substantial proportion of Bangladesh’s LPG imports is concentrated among a handful of operators, despite the presence of numerous licensed businesses.
According to NBR data, the country imported 157,760 tonnes of LPG in August and approximately 156,000 tonnes in September. Both figures were broadly in line with the estimated monthly demand of more than 150,000 tonnes.
Nevertheless, the availability of imported LPG has not translated into affordable prices for consumers. This has intensified questions about whether the problem lies primarily in import volumes, distribution arrangements or the way imported products are released into the market.
Bangladesh pays more than neighbouring countries
LPG prices in Bangladesh are also considerably higher than those reported in several neighbouring countries.
In November, the regulated price in Bangladesh stood at Tk 171.68 per kilogram. Comparative figures put the price at approximately Tk 87 in India, Tk 132 in Pakistan, Tk 130 in Sri Lanka and Tk 119 in Nepal.
These figures suggest that LPG in Bangladesh is around 30 to 45 per cent more expensive than in the countries included in the comparison. However, differences in taxation, government subsidies, import volumes and long-term supply contracts must be taken into account when comparing prices across national markets.
LOAB has cited several structural advantages that help explain India’s lower LPG prices.
According to the organisation, domestic refineries in India produce approximately 50 per cent of the country’s LPG requirements. India’s market is also around 20 times larger than Bangladesh’s, allowing importers to benefit from economies of scale and bulk purchasing arrangements.
The Indian government is providing approximately 30,000 crore rupees in LPG subsidies during the 2025-26 financial year. Bangladesh, by contrast, does not provide government subsidies for this sector.
Differences in port infrastructure also contribute to import costs. Large LPG carriers can berth directly at Indian ports, whereas Bangladesh relies on transferring LPG from large vessels to smaller ships in deep-sea waters before it can be brought ashore.
LOAB says this process can take around 25 days. With the daily operating cost of a large vessel estimated at approximately US$200,000, prolonged waiting and cargo-transfer operations significantly increase import expenses.
BERC chairman Jalal Ahmed also pointed to the advantages enjoyed by major importing countries. Larger markets can purchase greater quantities and negotiate long-term supply agreements. Government subsidies for household LPG in some countries further contribute to lower consumer prices.
Shift towards US imports increases shipping costs
Changes in the sources of Bangladesh’s LPG imports have created another financial challenge for the industry.
According to BERC data, the United States accounted for 27.4 per cent of Bangladesh’s LPG imports in September last year. By September this year, its share had risen sharply to 85 per cent.
During the same period, imports from Oman, Iraq, Saudi Arabia and the United Arab Emirates had stopped.
Importers say the change has significantly increased transportation costs. Shipping LPG from the Middle East generally takes around two weeks, whereas cargoes from the Gulf Coast of the United States require approximately 40 to 45 days to reach Bangladesh.
The longer journey increases freight and insurance expenses. It also ties up working capital for longer periods, raising the financial costs associated with importing the fuel.
LOAB claims that freight charges for transporting LPG from the United States previously stood at around US$82 per tonne. Shipowners are now demanding as much as US$250 per tonne.
The organisation also says importers have to pay a premium of US$300 to US$350 per tonne above Saudi Aramco’s announced contract price to secure LPG.
Vessel shortages and banking difficulties have made it harder for importers to negotiate long-term contracts with suppliers from alternative sources, according to the association.
International commodity prices have added to the pressure.
BERC determines domestic LPG prices each month using Saudi Aramco’s announced contract price, commonly known as CP, alongside the prescribed proportions of propane and butane.
For November, Saudi Aramco set the price of propane at US$720 per tonne and butane at US$780 per tonne.
Compared with November last year, propane prices had increased by 51.6 per cent, while butane prices had risen by 69.6 per cent.
The sharp increase in international prices has therefore added considerably to the cost of importing LPG into Bangladesh.
BPC’s direct import initiative has yet to deliver
The Bangladesh Petroleum Corporation (BPC) moved to reduce dependence on private importers by taking steps to import LPG directly in January this year.
The state-owned organisation invited tenders on five occasions between February and July but failed to secure an acceptable supplier.
The Cabinet Committee subsequently approved the procurement of 5,000 tonnes of LPG directly from Speed Marketing Corporation under a direct purchasing arrangement.
The company also deposited a performance guarantee of Tk 2 crore. However, it has yet to supply even a single kilogram of LPG.
BPC is also considering purchasing unused LPG plants owned by private companies or operating them through contractual arrangements.
If implemented, such measures could help expand the government’s capacity to participate directly in the LPG market. They could also reduce some of the country’s dependence on a small group of private importers.
However, the failure to secure supplies under the existing arrangement highlights the practical difficulties involved in establishing an alternative public-sector supply channel.
Government acknowledges excessive retail prices
Repeated attempts over two days to contact Energy and Mineral Resources Minister Iqbal Hasan Mahmud Tuku and Prime Minister’s Adviser on Information and Broadcasting Dr Zahed Ur Rahman regarding the LPG situation were unsuccessful.
However, speaking in Parliament last Thursday, Hasan Mahmud said the government did not import LPG directly. Private companies were responsible for importing the fuel, while prices were determined through BERC.
He said the government therefore did not have a direct role in the import process.
Information adviser Dr Zahed Ur Rahman has also acknowledged that LPG is being sold above the officially determined price.
Speaking to journalists at the Secretariat last Tuesday, he said that 12kg cylinders were selling for Tk 500 to Tk 600 above the regulated price in some locations.
Although there were some shortcomings in the supply system, he stressed that these could not be used as an excuse for charging consumers excessive prices.
The growing LPG crisis has exposed weaknesses across several parts of Bangladesh’s energy supply chain. International price increases, longer shipping routes, higher freight charges and limited port infrastructure have undoubtedly raised import costs. However, allegations of market manipulation, restricted supplies, excessive intermediary margins and weak enforcement suggest that import expenses alone cannot explain the persistent gap between official and retail prices.
The concentration of imports among a small number of companies has also raised questions about competition and accountability in a market serving more than 10 million customers.
For consumers, the immediate concern remains straightforward: they are paying significantly more than the price announced by the regulator for an essential household fuel.
Unless the authorities ensure transparent pricing at every stage, investigate allegations against major operators and strengthen supervision of distributors and retailers, repeated price adjustments and higher commissions are unlikely to bring meaningful relief to households.
