Bangladesh considering import of Russian oil via third country

Oil Import
Models of oil barrels and a pump jack are displayed in front of Ukrainian and Russian flag colors in this illustration taken, February 24, 2022. Photo: Reuters

Bangladesh is contemplating import of Russian oil via a third country.

According to sources at the Ministry of Power, Energy and Mineral Resources, neighbouring India might be such a preferred third country with regard to importing Russian oil.

"Currently, India has been importing Russian oil, defying US sanctions, while Bangladesh has a long-term contract with India to import refined oil from its refinery at Numaligarh in Assam state," said an official at the ministry, preferring anonymity.

"If there is a bilateral arrangement between the two nations, such a business (import) is possible," he said, adding it could be a possible way to avert the risk in import of Russian oil at a cheaper rate.

The possibility of importing petroleum from Russia came into discussion at the policymaking level, following an offer from a Russian company to sell its refined petroleum, especially diesel, at a cheaper rate to Bangladesh.

Russneft, a Russian oil company headquartered in Moscow, recently offered the state-owned Bangladesh Petroleum Corporation (BPC) petroleum at US$ 59 per barrel against a global market price of over $100 per barrel.

As per the offer, the Russian company will reach its refined petroleum to Chattogram port at the rate which includes the premium and shipping cost as well.

However, the Ministry of Power, Energy and Mineral Resources has not yet officially disclosed anything about the Russian company's offer.

State Minister for Power, Energy and Mineral Resources Nasrul Hamid declined to give any detail on such an offer.

"No more update as yet," he told UNB last Thursday.

Sources at the BPC said import of Russian oil is unlike fuel import from other countries.

They said Bangladesh is assessing its possible risks in importing petroleum from Russia, against the backdrop of sanctions imposed by the US and its allies.

Russia has been facing economic sanctions from the US and its European allies following Russia-Ukraine war.

If any country directly imports Russian oil, it may face similar sanctions, said the officials, adding that is why any move in this regard will not depend on the decision of the Ministry of Power, Energy and Mineral Resources alone.

According to official sources, after receiving the offer from Russia on petroleum sale, several concerned ministries including the foreign affairs, finance and energy resources are assessing the potential risks and different processes.

Prime Minister Sheikh Hasina at the Ecnec meeting on August 16 said that the government wants to buy fuel, fertilizer and wheat from Russia.

In this connection, she mentioned she had given the responsibility to her Principal Secretary to talk to the Russian Ambassador regarding the matter.

"The Foreign Ministry can take initiative in this matter, we will procure fuel from them (Russia) with our own funds as the SWIFT is closed and the price of dollar is very high," she said.

Meanwhile, Power Cell director Mohammad Hossain said that if the government can manage the import of diesel at cheaper rate, operation of the diesel-run power plants will be resumed to increase the power generation.


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