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Dhaka: Bangladesh has raised petroleum prices by a huge margin of 33.85-37.5 per cent to offset the impact of overheated international oil market on the domestic economy.
The price of most used oils - diesel and kerosene - increased to taka 55 per litre from 40 taka, while octane was revised upward to 90 taka from 67 taka and petrol 87 taka from 65 taka.
The price of furnace oil has gone up to 30 taka from 20 taka per litre and a cylinder of liquefied petroleum gas will now cost 1,000 taka instead of 600 taka.
An official handout on Tuesday announced the single biggest increase of fuel prices since the country's 1971 independence saying the interim government had no other alternative as record-breaking global oil prices were bleeding the state-run Bangladesh Petroleum Corporation white.
"We were helpless," chief advisor's special assistant for energy ministry Professor M. Tamim told newsmen after the official announcement adding that the government would still have to spend 100 billion taka in oil subsidies despite the latest price hike in the prices of petroleum products.
The latest hike, the second in 15 months, is feared to inflate further the transport and agriculture costs while the food price hike already exposed the 18-month old caretaker government to its worst crisis.
Senior government leaders including finance adviser Mirza Azizul Islam, however, hinted on several occasions in recent months that oil price hike was just a matter of time while the national budget for new 2008-2009 fiscal, initialled by President Iajuddin Ahmad on Sunday, allocated 5.40 billion taka to provide subsidy to farmers against diesel purchase for irrigation.
During the last fuel price readjustment in April 2007, the price was raised 13 to 21 per cent.
"We would have to spend 170 billion taka in subsidies if we did not adjust the petroleum prices for the new fiscal," as the price of a barrel of crude oil was $60 last year, while it went up to $143 on Sunday," Tamim said.
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