Category: Energy and Power

The heads of the International Energy Agency, International Monetary Fund, and World Bank recently said they will form a coordination group to maximize their response to the signi?cant economic and energy impacts of the war in the Middle East.

in a joint statement, the three global bodies noted that the war had caused major disruptions in the region and triggered one of the largest supply shortages in global energy market history. ‘At these times of high uncertainty, it is paramount that our institutions join forces to monitor developments, align analysis, and coordinate support to policymakers to navigate this crisis,’ the heads of the IMF, IEA and World Bank said.

the new coordination group will assess the severity of impacts across countries, coordinate a response mechanism, and mobilize stakeholders to deliver support to countries in need, the international bodies said.

Bangladesh’s energy challenge is no longer a distant policy concern. It is now a daily reality. From factories struggling to stay open to power plants running below capacity, the strain of gas shortages is being felt across the economy. Behind this lies a deeper structural issue: the country’s growing inability to secure a stable and affordable supply of natural gas, the very fuel that underpins its industrial growth and energy system.

the government’s foremost concern in achieving sustainable energy security is ensuring a smooth and reliable supply of primary fuel, particularly natural gas.

according to Petrobangla, current demand stands at around 4,000 MMCFD, while supply is limited to approximately 2,600 MMCFD, including about 900 MMCFD of imported regasi?ed LNG (RLNG). Domestic gas production has declined to around 1,700 MMCFD and continues to fall steadily.

the Bibiyana gas ?eld, operated by Chevron, alone contributes nearly 950 MMCFD, but it too is gradually depleting. Bangladesh cannot afford to remain heavily dependent on a single ?eld inde?nitely.

at the current rate of depletion, the country’s proven gas reserves could be exhausted by 2031.

in response, Petrobangla has undertaken two major drilling initiatives-the 50-well and 100-well programs. While these have yielded some incremental gains, the results have not been transformative. Meanwhile, two ?oating storage and regasi?cation units (FSRUs) at Maheshkhali supply between 900 and 950 MMCFD of RLNG. However, ongoing geopolitical tensions and con?icts in the Middle East have disrupted LNG supply chains and driven prices to record highs, limiting Bangladesh’s ability to rely on the spot market.

the consequences of gas shortages are already severe. Nearly 5,000 MW of gas-based power generation capacity remains idle due to inadequate fuel supply. Most fertilizer factories havebeen forced to suspend operations, affecting agricultural productivity. Many gas-dependent industries have shut down entirely, while others are struggling to survive under mounting operational costs.

this has created a ripple effect across the economy, impacting employment, exports, and overall industrial output. From both technical and economic perspectives, natural gas-both domestic and imported-will remain the dominant fuel in Bangladesh’s energy mix until at least 2040. Despite growing interest in renewable energy and clean technologies, Bangladesh cannot rapidly scale up these alternatives due to infrastructure limitations, high costs, and grid integration challenges. Natural gas, therefore, must continue to serve as the country’s primary transition fuel. This makes it imperative to develop and implement a comprehensive and realistic roadmap for gas exploration, production, and supply chain development.

it is important to recognize that Bangladesh is neither exceptionally rich in hydrocarbons nor entirely depleted of resources. Signi?cant untapped potential remains both onshore and offshore. However, unlocking this potential requires disciplined, technology-driven execution of welldesigned exploration programs. Unfortunately, successive governments have not prioritized systematic reservoir studies or updated assessments of resource potential.

although institutions such as the US Geological Survey (USGS), the Norwegian Petroleum Directorate, and international service companies have conducted studies in the past, follow-up actions have been limited and fragmented.

one of the most glaring examples of underutilized resources is the gas reserve in Bhola. Despite having proven reserves, the lack of pipeline infrastructure has prevented this gas from being integrated into the national grid. Similarly, exploration in the Chattogram Hill Tracts – particularly in promising structures such as Patiya, Jaldi, Sitapahar, and Kashalong – has been delayed due to policy indecision and geopolitical sensitivities.

offshore exploration, which holds signi?cant long-term potential, has remained largely stagnant for over a decade.

the government must now take decisive action by launching an aggressive but professionally managed and integrated exploration campaign. Petrobangla and BAPEX already possess extensive seismic data collected over decades.

this data should be consolidated into a comprehensive national database, with support from accredited international experts if necessary.

at the same time, updated reservoir assessments must be conducted to provide a clearer picture of existing reserves and future potential. Modern seismic technologies have advanced signi?cantly in recent years. Bangladesh must undertake comprehensive 2D and 3D seismic surveys across its entire landmass to identify new gas-bearing structures. Given the geological characteristics of the Bengal Delta, the world’s largest riverine delta, it is highly unlikely that the country has exhausted its gas potential.

a systematic and scienti?cally driven exploration approach could yield substantial discoveries.

a well-integrated exploration roadmap is essential. BAPEX must be strengthened through the recruitment of skilled professionals, improved training, and access to modern technology. Financial resources, including the Gas Development Fund, should be fully allocated to support upstream activities.

at the same time, joint ventures between BAPEX and international exploration companies should be actively encouraged, particularly in high-potential regions such as the Chattogram Hill Tracts.

immediate priority should be given to exploration in Chhatak and Tengratila, where there is strong potential for increasing reserves and discovering new resources. However, operations in these areas must be conducted with utmost care to avoid technical or environmental risks.

infrastructure development is equally critical.

the proposed Bhola-Barishal- Khulna pipeline project must be implemented without delay.

this pipeline would enable the evacuation of gas from Bhola to the national grid, unlocking signi?cant economic opportunities in southern Bangladesh.

the project would also support industrial development in the Khulna-Jashore region and provide a reliable energy supply for emerging economic zones.

on the policy front, ?nalizing updated Production Sharing Contracts (PSCs) for both onshore and offshore exploration is essential.

the revised PSC framework includes competitive pricing mechanisms linked to Brent crude, along with provisions for cost recovery, pro?t sharing, and pipeline investment returns. However, attracting international oil companies (IOCs) will require more than competitive terms.

the government must ensure transparency, policy consistency, and a stable regulatory environment.

a dedicated team of technical, ?nancial, and legal experts should be formed to negotiate effectively with potential investors.

it is also important to acknowledge the limitations of BAPEX. While the organization has a crucial role to play, it does not currently have the capacity to address the scale of the crisis on its own. Strategic partnerships with experienced international companies are essential to accelerate exploration and production.

at the same time, BAPEX should be supported in building its capabilities through technology transfer and joint operations.

if Bangladesh can mobilize around 10 exploration rigs, operated by both BAPEX and international partners, by 2027, there is a realistic possibility of discovering between 3 and 5 trillion cubic feet (Tcf) of new gas reserves by 2030. While offshore exploration may take longer to yield results, it remains a critical component of the country’s long-term energy strategy.

in parallel, the government must strengthen LNG infrastructure to ensure supply security. Delays in projects such as additional FSRUs and landbased LNG terminals have exacerbated the current crisis.

these initiatives should be revisited and expedited. The development of a land-based LNG terminal at Matarbari and the installation of additional FSRUs should be treated as national priorities.

the concept of strategic LNG storage should also be explored.

as seen in Europe and North America, LNG can be stored in cryogenic form for extended periods, providing a buffer against market volatility.

establishing such facilities in Bangladesh would enhance the country’s ability to manage supply disruptions and price ?uctuations. While renewable energy development must continue, it is important to adopt a realistic approach.

technical limitations, grid constraints, and cost factors will limit the rapid expansion of renewable energy in the short to medium term. Therefore, natural gas will remain central to Bangladesh’s energy system for the foreseeable future. Conclusion The path to sustainable energy security requires a clear set of priorities and decisive action.

the government must immediately initiate exploration at Chhatak and Tengratila and fast-track the Bhola-Barishal-Khulna pipeline project.

updated PSCs should be approved without delay, and bidding rounds must be launched by June 2026.

at the same time, LNG infrastructure projects-including additional FSRUs and land-based terminals-must be accelerated. Bangladesh should also diversify its LNG import sources beyond the Middle East to reduce supply risks.

ultimately, a balanced strategy that combines domestic resource development, LNG expansion, institutional strengthening, and gradual adoption of renewable energy will be essential. With disciplined execution and strong political commitment, Bangladesh can navigate its current energy challenges and build a more secure and resilient energy future.

Bangladesh’s unfolding fuel crisis is less about absolute scarcity and more about credibility, coordination, and policy inertia.

the government insists there is suf?cient fuel in the system, yet daily scenes of long queues and frustrated consumers tell a different story.

this disconnect is eroding public trust – arguably the most critical resource in times of crisis.

at the heart of the problem lies a fragile supply chain struggling to cope with external shocks and internal inef?ciencies. Panic buying has undoubtedly worsened the situation, but it is also a symptom of uncertainty. When people lack con?dence in a steady supply, hoarding becomes a rational response rather than irrational behavior.

equally concerning is the reluctance to adjust domestic fuel prices in line with global markets. While politically sensitive, delaying price adjustments has created distortions – encouraging excess demand, increasing subsidy burdens, and complicating supply management.

other regional economies have moved more decisively, stabilizing their markets even at the cost of short-term public discomfort. Policy responses so far – fuel passes, mobile courts, and enforcement drives – address symptoms rather than root causes. What is needed instead is a coordinated, transparent strategy that aligns pricing, supply, and communication.

expanding infrastructure, improving monitoring, and ensuring consistent supply to pumps are equally essential.

ultimately, this is a test of governance under pressure. Restoring order will require not just more fuel, but smarter policy, clearer communication, and genuine engagement with stakeholders. Without that, the queues may shorten temporarily, but the underlying crisis will persist.

The world’s worst energy crisis, caused by the Middle East war, will accelerate the development of renewables, nuclear energy and electric vehicles, the head of the International Energy Agency has predicted.

in a recent interview with a French newspaper, IEA executive director Fatih Birol argued that the current energy crunch ‘is more serious than those of 1973, 1979 and 2022 combined’. But despite the fuel price spike caused by Iran’s de facto blockade of the vital Strait of Hormuz chokepoint, there were ‘reasons to be optimistic’ from how ‘the architecture of the worldwide energy system will change’. ‘It will take years.

it will not be a solution to the current crisis, but the geopolitics of energy will be profoundly transformed,’ said Birol.

Thailand’s prime minister slammed recently oil traders for ‘excessive pro?teering’, blaming those stockpiling fuel or smuggling it abroad for shortages that have driven prices steadily higher. ‘Authorities have found cases of fuel stockpiling and smuggling for sale in neighboring countries,’ Prime Minister Anutin Charnvirakul said, adding the problem had cost the government 50 billion baht ($1.4 billion). ‘This action (smuggling and stockpiling) amounts to excessive pro?teering from rising oil prices during the global energy crisis,’ he said, calling it ‘a major factor behind the nationwide fuel shortages seen in recent weeks’.

evidence of hoarding and pro?teering among large and medium-sized oil traders had been found on land and at sea, he said

It needs no rocket science to understand the state of Bangladesh’s economy.

it’s not in good shape.

the common people have long been enduring the pinch of the deteriorating economy.

the cost of living has remained high with in?ation hovering around 9% for the past two years.

it all started before the US-Israel war on Iran with the spreading con?icts worsening the situation, not only in Bangladesh but globally. Bangladesh like many other countries is facing the headwinds both from domestic vulnerabilities and external factors, especially the latest outbreak of the Middle East war.

it has forced the newly elected government of Prime Minister Tarique Rahman to continue with tight monetary and ?scal policies. Not long ago Bangladesh’s economic growth drew special global attention. With the growth crossing 7 percent at one stage the growth was being seen as a model for economic development. Bangladesh, dismissed as a basket case at its birth ?ve decades ago, quali?ed to graduate from the LDC status by 2026 with all the necessary criteria necessary to ful?ll for the prestigious jump.

the BNP government has, however, requested for a deferment of the graduation citing lack of preparations stemming from domestic political changes and the adverse global condition.

the country’s struggling businesses have rather pressured the government to seek more time to reach the milestone in its development journey.

the issue is now on the table of the relevant UN organizations.

the country’s global lenders have already projected slower economic growth for ?scal 25-26.

the World Bank projects a GDP growth at 3.9%, down from its earlier projection of 4.6%.

the Asian Development Bank has lowered the growth to 4% from the earlier projection of 4.7%.

the growth projection from the International Monetary Fund has been slightly better at 4.7%, though it says it may dip to 4.3% in FY26-27.

the in?ation rate, according to IMF projection, may rise to 9.2%.

the projections re?ect the mood of local businesspeople. For the past few years the investment scenario has remained unsatisfactory.

the high interest rates have discouraged businesses from making any new investment.

at his latest meeting with a new batch of businesspeople the premier has stressed the need for developing the agriculture and agro industries. His call has been to focus on the northern region of the country.

it’s not because his home district Bogura sits in this region, but mainly the region offers to become a hub of agriculture and agro businesses. The region is already contributing towards the country’s agricultural growth. But mere new attention does not solve the problem. What is needed most is gas and electricity to power the growth the premier wants to achieve. The news from the power and gas sectors is not good.

the availability of gas from its reserves is declining. The US-Israel war on Iran has severely disrupted the supply chain of LPG and oil from the Middle East. Bangladesh’s dependence on imported LPG and oil has compounded its fragile energy security. We should not have pushed the country to such vulnerability. Wrong policies are to be blamed. We should have focused more on exploring our own natural gas resources instead of imported energy. Priority should have been given on solar energy. Policy should have been directed towards reducing the prices of the materials required for installing solar panels. Has it been right for us to ignore the environment-friendly extraction of our coal reserves? The summer season has already arrived amid concerns about energy shortage. Power outages are being forecast as the authorities are unable to produce enough electricity despite the higher capacity.

the rural towns and villages are reportedly ensuring load-shedding. With the Middle East crisis continuing despite a fragile truce we need to tackle the energy situation as if

Resident Representative, UNDP Bangladesh Stefan Liller has said unlocking new sources of climate ?nance is essential in Bangladesh, a country on the frontlines of climate change. The United Nations Development Programme (UNDP) and City Bank PLC signed a Memorandum of Understanding (MoU) recently to accelerate climate ?nance in Bangladesh by advancing the country’s emerging thematic bond market, with a focus on green investments. The signing ceremony took place at the City Bank head of?ce.

the MoU was signed by Stefan Liller, Resident Representative, UNDP Bangladesh and Mashrur Are?n, CEO of City Bank PLC, marking a signi?cant step toward mobilizing private sector investment for climate-resilient development, said UNDP.

Prime Minister Tarique Rahman recently held a marathon meeting with top businesses, focusing on improving the investment climate, resolving industry challenges and addressing the ongoing energy crisis. The meeting, held at the Prime Minister’s Of?ce in Tejgaon, continued for nearly three and a half hours.

after the meeting, Finance Minister Amir Khosru Mahmud Chowdhury told reporters that a wide range of issues related to trade, commerce and investment were discussed, with business leaders outlining key challenges and offering recommendations. ‘Problems and challenges facing the business sector were discussed, and ways to address them were explored. Business leaders shared their views,’ he said.

The Bangladesh government has announced a set of contingency action plans for immediate implementation to confront the ongoing energy crisis triggered by continued con?ict in Arab countries and the Persian Gulf region.

the primary objective is demand-side management through austerity in electricity and fuel use.

the stated target is to reduce daily electricity demand by 3,000 MW. This summer could see peak demand exceeding 18,000 MW.

even without the war, an increasingly import-dependent power supply system was not in a position to consistently generate 16,000 MW.

a de?cit of around 2,000 MW would likely have led to load-shedding during hot, humid summer days. Now, with the war pushing fuel prices sharply higher and disrupting supply chains, particularly due to constraints on shipping through the Strait of Hormuz, Bangladesh’s power system may struggle to consistently meet even 15,000 MW demand. Gas, LNG, coal, and liquid fuels are all becoming harder to procure on time and in suf?cient quantities.

under these circumstances, austerity and ef?cient consumption appear to be the only immediate tools available to limit load-shedding and ease pressure on fuel supplies for other sectors.

the government’s plan includes reducing of?ce hours for both public and private sectors to 9:00 am-4:00 pm, while banking hours will be shortened to 10:00 am-3:00 pm.

a major measure involves restricting shopping hours to 6:00 PM, later adjusted to 7:00 PM, except for businesses linked to food supply, pharmacies, and essential services. Fuel allocation for ministers will be cut by 30%, and the Ministry of Power, Energy and Mineral Resources has been instructed to reduce its expenditures by the same margin.

all overseas training programs for government of?cials will be suspended for three months, and even local training will be scaled back. Spending on meetings, workshops, and seminars will also be curtailed.

the government has further directed that no vehicles be imported using public funds for a speci?ed period.

educational institutions are expected to announce separate measures to reduce energy consumption.

there are also indications that electric buses are being imported to support public transportation. However, the overall austeritypackage requires careful scrutiny and coordinated implementation.

it remains unclear how extensively these measures were planned before being announced. For example, the initial decision to limit shopping hours to 6:00 pm did not work on the ?rst day, as shop owners had already announced an 8:00 pm closing time.

eventually, the government adjusted the limit to 7:00 pm. While reducing shopping hours can signi?cantly cut lighting and cooling demand during peak periods, such policies cannot succeed without proper coordination among stakeholders. Business owners, already facing multiple challenges, must be consulted before major changes to operating practices are enforced.

in many developed countries, retail outlets typically close by early evening, with extended hours only on speci?c days. Several countries across South Asia, Southeast Asia, Europe, and even Australia have adopted contingency measures to address energy crises. However, in Bangladesh, where major changes often face resistance, successful implementation requires inclusive planning and stakeholder engagement.

the most immediate impact of the war is being felt in the procurement and transportation of liquid fuels, including crude oil, diesel, LPG, and LNG. There are concerns that the Eastern Re?nery Limited may have to suspend operations due to a shortage of crude oil. Diesel shortages have already affected ?shing vessels, trawlers, and lighterage vessels transporting goods inland.

if the situation persists, road, river, and rail transportation could soon be disrupted.

the government is attempting to source crude oil, petroleum products, and LNG from alternative suppliers. However, higher prices and increased shipping and logistics costs are placing signi?cant strain on national ?nances.

the new government may not be able to sustain large subsidies for an extended period.

eventually, adjustments to fuel and electricity prices may become unavoidable, which could trigger broader in?ationary pressures across the economy.

in this context, the government must engage all stakeholders and consider declaring the energy crisis a national emergency to ensure coordinated action.

the proposal to introduce online classes for educational institutions also requires careful consideration. School students, particularly at the primary and secondary levels, already spend signi?cant time on electronic devices and bene?t greatly from in-person academic environments.

instead of a full shift to online learning, schools could be supported with incentives to arrange shared transportation, while limiting the use of private vehicles. Universities and colleges, on the other hand, may be better suited to adopt online classes.

adjustments to school hours and staggered weekly holidays could also help reduce peak electricity demand. Another critical area is the internal fuel supply chain.

the movement of fuel from depots to ?lling stations, and from stations to end-users, must be closely monitored to prevent disruptions. Strong administrative oversight is essential to ensure smooth distribution and to curb any irregularities.

at the same time, the media can play a constructive role by encouraging responsible consumption of fuel and electricity.

the government must also carefully assess any adjustments to fuel and electricity prices to ensure that such measures do not disproportionately fuel in?ation.

at the same time, longstanding priorities-such as accelerating domestic energy exploration and increasing the share of renewable energy-must not be overlooked. Reducing wastage, preventing pilferage, and improving ef?ciency across the energy system should remain central objectives.

on the supply side, Bangladesh needs to pursue proactive energy diplomacy to secure long-term governmentto-government agreements with countries such as Malaysia, Indonesia, Australia, and others, including those in the former Soviet region. Relying on expensive spot market purchases is not a sustainable strategy.

at the same time, the government should expedite the expansion of re?ning capacity, including upgrading the Eastern Re?nery and establishing a second re?nery. Developing strategic reserves of crude oil, petroleum products, LNG, and LPG-suf?cient for at least 45 to 60 days-should also be prioritized. Such reserves would provide critical ?exibility in managing supply shocks and stabilizing the domestic market during crises.

ultimately, the government must act with caution and clarity, ensuring that policy decisions do not create unnecessary panic among the public. Con?dence, coordination, and transparency will be key to navigating the current crisis while laying the groundwork for a more resilient energy system.

Bangladesh Bank has set new of?ce and transaction hours for all scheduled banks as part of nationwide efforts to conserve fuel and electricity.

according to a circular issued recently, bank of?ces will remain open from 10:00am to 5:00pm, while customer transactions will be conducted from 10:00am to 3:00pm from Sunday through Thursday until further notice. However, branches, sub branches, and booths located in seaport, land port, and airport areas, including port and customs zones, will continue to operate 24 hours a day, seven days a week, in line with existing directives.