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Bangladesh to import oil from UAE at lower premium

Bangladesh to import oil from UAE at lower premium
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First Published: Tue, Jan 22 2008. 03 16 PM IST
Updated: Tue, Jan 22 2008. 03 16 PM IST
Dhaka: The state-run Bangladesh Petroleum Corporation (BPC) will buy 390,000 tonnes of refined oil from a UAE state firm that has offered to sell it to Bangladesh at a lower premium, an energy official said on 22 January.
The Emarat, a leading state-run oil firm of United Arab Emirates, last month agreed to charge a reduced premium compared with other countries, that would save Bangladesh about $438,000, the official said.
The board of directors of the BPC early this month finalised the decision and sent it to the energy ministry for approval for importing 330,000 tonnes of diesel and 20,000 tonnes each of kerosene, jet fuel and high-octane motor gasoline.
“We need to import more fuel, especially diesel to meet growing demand of farmers to irrigate their rice fields,” the official told Reuters, asking not to be identified.
Irrigation is required for cultivating boro, a major rice variety in Bangladesh that is grown between January and May and accounts for 50% of the country’s annual food production of 27 million tonnes, officials said.
Bangladesh’s current annual requirements for diesel is 2.3 million tonnes, of which the BPC imports nearly 1.6 million tonnes from Kuwait.
Of the rest, 200,000 tonnes are imported from India and up to 400,000 tonnes come from Bangladesh’s state-run Eastern Refinery Limited, at Chittagong port city.
Emarat has agreed to charge a premium rate of $5.2 for a barrel of diesel, $5.6 for kerosene and jet fuel and $7.5 for high-octane motor gasoline a barrel to Middle East spot quotes, cost and freight basis, the official said.
The state-run Kuwait Petroleum Corporation charged premium for diesel at $5.35 each barrel, $5.65 for kerosene and jet fuel, and $7.70 for high-octane motor gasoline.
The Middle East Oil refinery of Egypt will charge $5.3 a barrel for diesel and Bharat Petroleum Corporation of India charges $5.49 a barrel for diesel.
Bangladesh’s total annual demand for fuel is 3.8 million tonnes, of which diesel accounts for 65%, kerosene 25% and the rest is gasoline.
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First Published: Tue, Jan 22 2008. 03 16 PM IST
More Topics: Bangladesh | Energy | UAE | Oil | Premium |