Private crude oil importers in Bangladesh face significant financial challenges due to a dual tariff policy imposed by the government, which creates disparities between public and private sector importers.

Sector insiders claim that fluctuating dollar rates and higher import duties for private companies make it difficult for them to compete in the market.

The government and private sector purchase crude oil from the global market at the same price. However, private importers are taxed based on the invoice value, whereas state-owned companies are taxed at a lower tariff rate (tariff value). This discrepancy is causing private entrepreneurs to suffer substantial losses.

Under such circumstances, they are calling for a uniform tariff policy for both sectors.

Energy experts have voiced concerns over this dual policy, emphasising the need for consistent pricing regulations. “It is not appropriate to have different policies for the same product within a country,” said Energy Adviser Muhammad Fouzul Kabir Khan. “A committee is being formed to review the issue, and a decision will be made based on the committee’s recommendations.”

Currently, the government has set fuel prices in line with the international market for September. The cost of diesel and kerosene is Tk105.5 per litre, octane is Tk125, and petrol is Tk121.Private crude oil importers have appealed to the interim government for an adjustment in the pricing formula, seeking a consistent policy for both public and private importers. The Ministry of Power, Energy and Mineral Resources is expected to decide after the committee’s evaluation.

Officials from the Energy Division said they would discuss the matter with the National Board of Revenue to get a solution. A final decision will be made after comprehensive discussions.

In practice, Bangladesh Petroleum Corporation benefits from the lower tariff value while clearing goods through the Chattogram Customs House. In contrast, private companies are taxed at the full invoice value, leading to financial strain.

Pointing out the need for a uniform tariff for the same product, economist Prof Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, told the Daily Sun, “Having different tariffs for the same product complicates the reconciliation with international market prices.”

Energy researcher Prof Ijaz Hossain, former dean of engineering at Bangladesh University of Engineering and Technology, suggested adjusting the tariff value to ensure fairness in the energy sector, allowing for healthy business practices.

He underlined the role of regulatory bodies like the Bangladesh Energy Regulatory Commission (BERC) in ensuring fair practices, especially for the private sector.

Energy expert Prof M Shamsul Alam said all energy prices should be determined through public hearings, regardless of whether the tariff is invoice-based or otherwise.

“The previous government’s practices were not fair. We have been advocating for empowering BERC to regulate energy pricing,” Prof Alam told the Daily Sun.

The country’s annual fuel oil demand is around 7.5 million tonnes, with diesel accounting for 5 million tonnes. In the last fiscal year, the government spent approximately $5 billion on fuel oil imports. The high demand for fuel, combined with the dual tariff policy, has further strained private crude oil importers.