An official has said India will send the 5,000 tonnes of diesel to Bangladesh today, as the two nations work to be sure of their fuel as things become less stable in West Asia. The shipment is the first real delivery from a long-term supply deal, and it comes at a time when the world’s supplies are tight and costs are going up.
What’s in the shipment, and when will it get there?
Muhammad Rezanur Rahman – head of the Bangladesh Petroleum Corporation – has stated that the 5,000 tonnes is part of a yearly amount under a 15-year deal. The deal lets Bangladesh get up to 180,000 tonnes of low-sulfur diesel a year from India.
Rahman also said the deal needs a minimum of 90,000 tonnes to be brought in over six months. Officials believe they will get the whole six-month amount in about two months, so as to quickly build up supplies at home.
What the India-Bangladesh deal covers: prices and getting the fuel there
The 2017 deal with India’s Numaligarh refinery sets the terms of supply and the pricing. Bangladesh pays using world standards, plus a set amount added on, which gives a bit of price certainty even when world oil prices change.
At first, India’s supply under the 2026 amount went from the Numaligarh place in Siliguri to the Parbatipur storehouse in northern Bangladesh. Now the fuel goes through the India-funded Bangladesh-India Friendship Pipeline; this has made delivery faster and cut transport costs when compared to how it was done with rail.
How the pipeline works, what it does for the environment, and how much it can carry
The Bangladesh-India Friendship Pipeline is about 81.5 miles long, and has been working since late 2022 – it was properly opened in 2023. The pipeline gets diesel to the northern districts in an efficient way, helping power stations, farming, transport and industry in the area.
As well as making delivery faster, using a pipeline cuts the pollution from truck and train lines, and lowers losses from handling. The arrangement also makes it easier to plan what stock to keep, which is a major benefit when markets are unsettled.
What’s happening in the market: fighting, the Strait of Hormuz, and the risk of price rises
The delivery is happening as fighting in the Gulf area has broken up shipping routes and lowered the amount of exports. Around 20 to 25 percent of the world’s oil and gas which is moved by sea goes through the Strait of Hormuz; any stop or delay there would be very damaging to supply lines.
Oil costs have jumped to four-year highs because of the trouble, going over $100 a barrel and even up to $119. Experts warn costs could go toward $150 a barrel if things get worse and tanker traffic stays limited in the Hormuz area.
What this means for Bangladesh’s energy security and the relationship between the two countries
Bangladesh has also asked India to think about an extra 50,000 tonnes over the next four months, a request India is looking at well. This cooperation over supply shows the sensible relationship which goes on despite other diplomatic problems and projects which have been put on hold between the two governments.
At home, Bangladesh’s new government is checking fuel stores because of fears about people keeping fuel back and making fake shortages. Dependable shipments from India through the pipeline give people who make policy a clearer way to make sure supplies at home are steady, and to deal with how costs affect people who buy things and industry.
The 5,000-tonne shipment is a real step to making energy security in Bangladesh stronger, and shows how regional buildings and long-term deals can lower the chance of harm from world shocks. How well the country deals with high market changes will depend on deliveries going on and close working together on getting things where they need to be.
