LPG Shortage, Overcharging Hit Consumers Across Dhaka

Liquefied petroleum gas (LPG) cylinders have become scarce in parts of Dhaka as retailers sell them at prices far above the government-fixed rates, with some reportedly avoiding sales for fear of raids and mobile courts.

Despite the latest price hike by the Bangladesh Energy Regulatory Commission (BERC), consumers are still struggling to find LPG cylinders in several areas of the capital. In some parts of central Dhaka, retailers are reportedly charging as much as Tk 2,500 for a 12-kg cylinder, compared with the government-fixed price of Tk 1,837.

Retailers said LPG suppliers are charging around Tk 2,200 for a 12-kg cylinder following the latest price adjustment. They expect cylinders reflecting the new rates to enter the market from Tuesday, with consumer prices potentially reaching Tk 2,300 to Tk 2,400 from Wednesday.

Sector insiders said LPG cylinders have been sold above government-fixed prices for years, citing a mismatch between supply and actual market demand.

They attributed the persistent market distortion to a widening gap between national demand, estimated at around 1.4 to 1.5 million tonnes annually, and constraints in the supply chain. They said the situation has allowed market prices to remain significantly above regulatory rates.

Retailers reported that primary LPG distribution companies are already invoicing dealers between Tk 2,100 and Tk 2,200 per 12-kg cylinder, making it difficult for retailers to sell at the government-fixed rate.

“Though the government fixed the price at Tk 1,837, the bottling companies themselves are charging us up to Tk 2,200,” said Abdul Wares, an LPG supplier in Boro Moghbazar. He said transport and labour costs further increase the final price for consumers.

Traders warned that fresh stock under the newly announced rates could enter the market by Tuesday, potentially pushing the retail price of a 12-kg cylinder to Tk 2,400 by Wednesday.

For October, BERC raised the retail price of private LPG to Tk 153.06 per kg, including VAT, from Tk 132.08 in September.

Accordingly, the price of a 5.5-kg cylinder was set at Tk 842, up from Tk 727, while a 12.5-kg cylinder was fixed at Tk 1,913, compared with Tk 1,652 previously. The prices of 15-kg and 20-kg cylinders were set at Tk 2,296 and Tk 3,061, respectively, while the price of a 45-kg commercial cylinder was fixed at Tk 6,888.

The price of autogas, widely used in motor vehicles, also increased by Tk 11.53 per litre to Tk 84.62 from Tk 73.09 in September. Reticulated LPG in liquid form was set at Tk 149.31 per kg.

The price of the state-owned LP Gas Limited’s 12.5-kg cylinder remains unchanged at Tk 776.93. However, its limited market share means it offers little relief to most consumers.

BERC attributed the latest LPG price increase to higher international contract prices. Saudi Aramco’s average Contract Price for propane and butane, based on a 35:65 ratio, rose to $712.50 per metric tonne for October from $647.75 in September.

BERC has instructed storage and bottling licensees to issue proper VAT invoices and strictly comply with the post-bottling price caps.

Business representatives, however, urged the government to reassess national LPG demand and streamline import channels to help stabilise the volatile energy market.