Bangladesh is in talks to negotiate a short‑term liquefied natural gas supply agreement with Saudi Arabian oil giant Aramco, a move aimed at ensuring a steadier gas supply and reducing reliance on unpredictable spot markets. This development comes as Bangladesh braces to import LNG cargoes under a recently signed agreement with Oman’s OQ Trading. According to officials, Aramco has been shortlisted as a potential supplier by Petrobangla and has already delivered one spot cargo under competitive bidding. The new deal, if finalised, would mark Aramco’s first formal short‑term LNG contract with Bangladesh beyond occasional spot transactions. Petrobangla chairman Md Rezanur Rahman noted that Bangladesh plans to import a similar volume of LNG from Aramco as it will from OQ Trading, which has committed to supply 17 cargoes between August 2025 and December 2026, five in 2025 and twelve in 2026. The short‑term deal is designed to provide greater flexibility, cost predictability, and coverage during peak demand periods such as summer and Ramadan. It also acts as a strategic bridge before new long‑term contracts begin deliveries. Under the OQ Trading agreement, Bangladesh will pay a fixed premium of about 15 cents per MMBtu above the Platts‑assessed Japan Korea Marker (JKM) benchmark, offering relief from costly preferred‑supplier arrangements linked solely to Brent pricing. Officials say the Aramco contract may follow a similar pricing structure tied to JKM, though the exact premium is still under negotiation while the agreement is being vetted by authorities. This diversification effort comes as Bangladesh seeks to reduce dependency on traditional long‑term contracts with QatarEnergy and OQ Trading, which offer base supply but lack pricing flexibility in volatile global markets. Spot market LNG is typically procured by RPGCL, the state gas procurement agency, ordering three to four cargoes per month—or more during high demand periods. But suppliers often charge steep premiums—sometimes as much as 50 to 70 cents or even up to $1.50 per MMBtu over JKM—to protect themselves against price swings and payment delays. Officials expect around 52 spot cargoes in 2025, the highest ever for Bangladesh, highlighting the urgency of securing more reliable sources. Analysts and stakeholders welcome the proposed Aramco agreement, saying that a short‑term contract could stabilise gas availability and support energy planning while keeping costs in check. If prices stay competitive and volumes are sufficient, this move could ease supply bottlenecks, support power generation and industrial growth, and offer greater flexibility than rigid long‑term deals alone. By working with different suppliers and exploring short‑term SPAs in addition to traditional contracts, Bangladesh is laying the groundwork for a more resilient gas procurement strategy, capable of meeting fluctuating domestic demand and global price shifts.
