f the Iran-Israel war prolongs, it could have serious negative implications for Bangladesh’s energy sector. A potential closure of the Strait of Hormuz—one of the world’s key maritime trade routes—would disrupt the import of Liquefied Natural Gas (LNG) and fuel oil.
With rising geopolitical tensions in the Middle East, the supply of LNG is already facing potential disruption. Last week, LNG prices surged in Asia’s spot market, and if instability deepens, domestic energy prices may rise, according to senior government sources.
Overall, concerns are growing over the country’s future energy security. A rise in LNG and oil prices would increase electricity production costs, subsequently impacting industrial output, transport, agriculture, and retail prices—ultimately fuelling inflation and raising the cost of living.
Currently, over 30% of the country’s gas demand is met through LNG imports, mostly sourced from the Middle East. Experts warn that any prolonged conflict could lead to price volatile imports
supply shortfalls. Petrobangla officials confirm that with natural gas reserves declining, any further reduction in LNG supply would severely affect residential, industrial, and power generation needs.
Bangladesh mainly imports LNG under long-term agreements with Qatar and Oman, with the Strait of Hormuz being the primary transit route. A prolonged conflict may render these imports more expensive or infeasible. Of 115 LNG cargoes planned for this year, 23 have arrived, while 33 are still due. If Hormuz is blocked, rerouting via Abu Dhabi will raise shipping costs significantly.
Energy experts also note that Bangladesh previously paid as high as $36 per unit for LNG during the Russia-Ukraine conflict. Dollar shortages later forced a seven-month halt in open-market LNG purchases. Energy Division officials confirm that contingency planning is underway to fast-track current imports through the strait before conditions worsen.
Globally, around 21 million barrels of oil pass through the Strait of Hormuz daily. A temporary blockade would cause a spike in oil prices and shipping costs. Economic adviser Dr. Salehuddin Ahmed has acknowledged that if the war drags on, Bangladesh will inevitably feel the impact, including higher costs for fuel, fertiliser, and shipping.
The Ministry of Power, Energy and Mineral Resources has already held multiple meetings on the issue. Instructions have been issued to LNG and oil suppliers under G2G and private deals to expedite deliveries by June–July. Steps are being taken to mitigate the crisis to the extent possible.
