Bangladesh Petroleum Corporation begins talks next week on term contracts to import oil products to meet growing domestic demand in 2012, a senior company official has said.
A team headed by BPC Chairman Mohammad Abu Bakar Siddique is heading to Kuwait and Singapore to hold talks with Kuwait Petroleum Corporation (KPC), Emirates National Oil Company (ENOC), Malaysia's Petronas, Egypt's Middle East Oil Refinery and Philippines National Oil Company (PNOC), the official said on Friday.
"In Kuwait they will discuss quantity and price details with KPC and with other companies in Singapore," he said.
Bangladesh's fuel oil imports are likely to more than double next year to around 1.65 million tonnes, while overseas purchases of diesel may rise about 25 percent to 3.74 million tonnes on growing domestic demand, a senior BPC official told Reuters this week.
Besides diesel and fuel oil, Bangladesh will import 385,000 tonnes of jet fuel, 100,000 tonnes of 95-octane gasoline and 90,000 tonnes of kerosene in 2012, the official said.
In 2011, BPC paid a premium of $3.14-$3.30 a barrel to Middle East spot quotes for diesel and $31.50-$32.00 a tonne to Singapore spot quotes for 180-centistoke (cst) fuel oil.
Bangladesh also buys fuel oil from Vietnam's Petrolimex, PetroChina and Maldives National Oil Company.
The state-owned company is likely to face higher prices for 2012 supplies, compared to 2011, as fuel prices have been on the rise, traders said.
Spot cargo premiums for fuel oil have been holding at strong levels of above $12.00 a tonne, while Asian refiners have been selling 2012 term cargoes for gasoil at firmer price levels.
Domestic demand for fuel oil has been swelling as a shortfall of natural gas supply forced the country to turn to costly oil-fired quick rental power plants. The chronic electricity shortage has limited economic growth and investments in Bangladesh and often stirs public fury.
However, the move to import has put more pressure on the country's balance of payments and massive subsidy bill.
The government heavily subsidizes BPC, the country's sole oil importer and distributor, which sells fuel oil to the local market at much lower rates than import prices.
The total subsidy for the year to June 2012 is forecast to jump to around Tk 460 billion ($6 billion) or 5 percent of gross domestic product, more than double than the original estimate of Tk 200 billion, and up from Tk 195 billion the previous year.
A team headed by BPC Chairman Mohammad Abu Bakar Siddique is heading to Kuwait and Singapore to hold talks with Kuwait Petroleum Corporation (KPC), Emirates National Oil Company (ENOC), Malaysia's Petronas, Egypt's Middle East Oil Refinery and Philippines National Oil Company (PNOC), the official said on Friday.
"In Kuwait they will discuss quantity and price details with KPC and with other companies in Singapore," he said.
Bangladesh's fuel oil imports are likely to more than double next year to around 1.65 million tonnes, while overseas purchases of diesel may rise about 25 percent to 3.74 million tonnes on growing domestic demand, a senior BPC official told Reuters this week.
Besides diesel and fuel oil, Bangladesh will import 385,000 tonnes of jet fuel, 100,000 tonnes of 95-octane gasoline and 90,000 tonnes of kerosene in 2012, the official said.
In 2011, BPC paid a premium of $3.14-$3.30 a barrel to Middle East spot quotes for diesel and $31.50-$32.00 a tonne to Singapore spot quotes for 180-centistoke (cst) fuel oil.
Bangladesh also buys fuel oil from Vietnam's Petrolimex, PetroChina and Maldives National Oil Company.
The state-owned company is likely to face higher prices for 2012 supplies, compared to 2011, as fuel prices have been on the rise, traders said.
Spot cargo premiums for fuel oil have been holding at strong levels of above $12.00 a tonne, while Asian refiners have been selling 2012 term cargoes for gasoil at firmer price levels.
Domestic demand for fuel oil has been swelling as a shortfall of natural gas supply forced the country to turn to costly oil-fired quick rental power plants. The chronic electricity shortage has limited economic growth and investments in Bangladesh and often stirs public fury.
However, the move to import has put more pressure on the country's balance of payments and massive subsidy bill.
The government heavily subsidizes BPC, the country's sole oil importer and distributor, which sells fuel oil to the local market at much lower rates than import prices.
The total subsidy for the year to June 2012 is forecast to jump to around Tk 460 billion ($6 billion) or 5 percent of gross domestic product, more than double than the original estimate of Tk 200 billion, and up from Tk 195 billion the previous year.
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