2026 Bangladeshi energy crisis
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Bangladesh is experiencing an ongoing national fuel and power deficit in 2026. It was caused by a combination of declining domestic natural gas reserves, reliance on imports, and global fuel price shocks. The crisis has led to record-high electricity load-shedding, reduced industrial production, and government-mandated energy conservation measures nationwide.
Background
The Bangladeshi energy crisis is reportedly driven by decades of inadequate planning, reliance on imports, ineffective exploration, distorted pricing, and inefficient use of domestic resources.[1] Domestic gas production fell continuously for nine years.[2] Since 1998, no new large gas fields have been discovered.[3] To meet the growing demand, the government started importing liquefied natural gas (LNG).[1] This led to the country relying more on imported fossil fuel, increasing from 47.7% to 62.5% in four years.[4] By early 2026, natural gas was used to generate about 43% of the country's electricity, while coal made up 27%.[5]
The reliance on imported energy left the sector exposed to international price fluctuations.[6] Rising global fuel prices and the Middle East crisis, caused Asian spot LNG prices to double from January to August 2026.[7] Over the past year, the cost of power generation per unit has increased by nearly 8 percent.[8] In just one year, the rental costs for power plants rose by Tk 10 billion.[8] Money meant for gas exploration was used instead to subsidize LNG imports.[9] In 2026, the national gas demand is about 3,800 million cubic feet per day.[10] According to Petrobangla, Bangladesh has 7.63 trillion cubic feet of domestic gas reserves. At the current extraction rate of around 1,700 million cubic feet per day, these reserves are estimated to last for 12 years.[11]
Timeline
March–Mid 2026
Bangladesh imports 95% of its oil and gas needs, mainly from West Asia.[12] The closure of the Strait of Hormuz due to the Iran war has halted energy supplies to the country. During the conflict, Asian spot LNG prices surged by 125% to $22.51 per MMBtu, later peaking above $28 per MMBtu for some prompt spot cargoes.[13] Additional fuel import costs increased by $760 million to $830 million per month.[13] Blended generation costs rose to Tk 18–22 per kilowatt-hour, increasing monthly subsidy requirements to Tk 7,500-9,500 crore, which is more than double the pre-crisis level of Tk 3,000-4,000 crore.[13]
On 6 March, Bangladesh Petroleum Corporation imposed limits on the purchase of fuels. For instance, motorcycles were allowed to buy up to 2 liters of octane or petrol per day; private cars could purchase 10 liters; SUVs, jeeps, and microbuses were permitted 20 to 25 liters; pickups and local buses could buy 70 to 80 liters; and long-distance buses, trucks, and container carriers were allowed 200 to 220 liters of diesel.[14] The restriction was lifted on 15 March.[15]
Bangladesh closed universities amid the crisis to save power, bringing the holiday for Eid ul-Fitr forward.[16] The government also asked that all foreign-curriculum schools and private coaching centers suspend operations during this period to reduce electricity consumption.[17] Also, all shopping malls and stalls were initially instructed to close at 8 PM,[18] but this was revised to 6 PM and then changed to 7 PM.[19]
Four of the five state-run fertilizer factories halted operations amid the crisis, redirecting available gas to power plants to prevent widespread outages.[20]
Bangladesh increased electricity generation from domestic coal plants and imported coal-generated electricity from regional grids to compensate for gas shortages.[21]
July–September 2026
On 21 July 2026, a technical failure involving a boiler explosion and fire occurred at the Excelerate Energy-operated Floating Storage and Regasification Unit (FSRU) in Moheshkhali.[22] The outage removed 450 million cubic feet per day (MMCFD) of regasified natural gas from the national grid, cutting imported LNG capacity by about half and reducing the nationwide pipeline gas supply by roughly 17%.[23]
The gas supply allocated to gas-fired power plants decreased from over 900 MMCFD to around 700 MMCFD during this period.[24] As a result, the generation output from gas-fired power plants fell from a normal level of around 5,200 MW to about 3,500 MW.[24] Simultaneously, coal-fired plants faced capacity reductions due to fuel shortages and maintenance issues.[24]
The daily average power generation deficit increased from 320 MW in mid-July to 1,482 MW by the end of July. Hourly load-shedding deficits peaked at 2,174 MW on 1 August.[24] Until 4 August, the deficit was above 2,000 MW. On 6 August 2026, one of the affected Excelerate terminal partially resumed operations, adding back 115 MMCFD to reach a total of 280 MMCFD,[25] decreasing the deficit.[26]
Shortly after that, power shortages worsened again due to disruptions in coal handling, which compounded an ongoing shortage of gas for power generation. The deficit was 335 MW on 6 August, 740 MW on 7 August, spiked to 2,167 MW on 7 August, and reached 3,064 MW on 9 August.[27] On August 10, the load shedding reached a historic record of 3,767 MW.[28]
On 15 August, the second terminal came back online, restoring another 460 MMCFD.[29] On 19 August, FSRU completely ran out of LNG inventory, and the supply fell below 2,200 MMCFD.[25] On 27 August, the production of 62 out of 137 power plants was disrupted, resulting in load shedding exceeding 3,000 MW again.[30] This was due to the gas crisis, which led to a decrease in supply to the power sector in favor of increased supply to the industry.[31]
The crisis has deepened due to a decrease in the arrival of LNG cargoes, with six fewer shipments this year compared to last year. Also, the situation has reportedly been worsened by procurement delays involving new suppliers. These companies were supposed to supply four cargoes in August but failed to do so.[32] Starting from 2 September, Adani Power has reduced electricity dispatch to Bangladesh during daytime off-peak hours due to disruptions in coal transportation by rail.[33] On the same day, Nepal also stopped exporting electricity to Bangladesh after the 2026 floods damaged two hydropower projects.[34] On 10 September, one of the two units of Adani Power's 1,600 MW power plant in Jharkhand went offline due to a technical fault, causing the power supply from the plant to fall from 1,400 MW to 750 MW and increasing load shedding to more than 2,500 MW.[35]
The government has imposed limits on the operating hours of shopping malls, markets, and shops across the country as part of efforts to conserve electricity. Under the new schedule, these establishments may remain open from 11:00 AM to 8:00 PM.[36][37] Additionally, illuminated billboards must be turned off by 7:00 PM, and all types of decorative lights are required to be turned off entirely.[36]
During the crisis, rural consumers in certain areas faced up to 16 hours of power cuts each day. Gopalganj experienced eight to ten hours of power cuts daily. In Netrokona, residents reported that load-shedding lasted up to 18 hours. In urban Rajshahi, residents reported two to four hours of outages,[38] while rural areas in Rajshahi reported power cuts lasting up to 20 hours.[39] Later, the government decided to enforce higher load shedding in the capital to relieve the pressure from rural areas.[40]
Economic impacts
The crisis impacted the textile sector, which accounts for 80% of Bangladesh's exports,[41] along with the food, pharmaceuticals, ceramics, steel rod, glassmaking, and other industries.[42][43] The gas line pressure dropped to almost zero.[44] Low pipeline gas pressure caused factories to operate below capacity or rely on costlier alternatives like Liquefied petroleum gas, or diesel,[45] which increases the production cost by 10–15%.[46] According to Prothom Alo, 660 textile mills across the country have been experiencing a gas shortage since the third week of July, leading to partial halts in production at these factories.[47] The prices of raw materials surged as naphtha-based polyester, dyes, and petrochemical inputs rose by nearly one-third.[48] Businesses lost operating hours while factories struggled to maintain production schedules due to power interruptions, which compounded existing gas supply issues.[49]
Responses
Power cuts due to the crisis triggered public protests across multiple districts of the country.[50] The opposition leaders have also criticized the government over the crisis.[51] As public anger grew, 80 offices of Bangladesh Rural Electrification Board asked for protection from the police.[52] However, Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood denied the claims of electricity shortages and blamed them on technical failures.[53]
On 2 September, Prime Minister Tarique Rahman announced a five-point plan to address the energy crisis by increasing domestic gas production, expanding exploration, strengthening Bangladesh Petroleum Exploration and Production Company Limited, developing LNG infrastructure, and reducing reliance on imported gas.[54]
On 5 September, the 11 Party Alliance launched a protest over the crisis.[55] On 8 September, the State Minister for Energy announced that 1,200 MW of electricity would be added to the national grid the following week, along with plans to drill 106 new gas wells and conduct offshore exploration. He also said that the government aims to overcome the crisis by 2030.[56]