BANGLADESH — A worsening natural-gas shortage is putting pressure on almost every part of Bangladesh’s economy—from factories and fertiliser production to electricity generation, transport and household kitchens—as the country struggles to secure enough fuel to meet demand.
The crisis has been building for years, but recent disruptions to imported liquefied natural gas (LNG) supplies have exposed just how vulnerable Bangladesh’s energy system has become.
A CNA report based on AFP reporting found that the shortage has forced major industrial facilities to reduce production or shut down, while households in some areas face extremely low gas pressure and repeated electricity outages.
From gas producer to import-dependent economy
Bangladesh was largely self-sufficient in natural gas as recently as 2018. But production from mature fields has declined, while demand from power plants, factories and households has continued to rise.
That gap has increasingly been filled with imported LNG.
Reuters reported that Bangladesh normally faces demand of roughly 3,800 to 4,000 million cubic feet per day (mmcfd) against domestic and imported supplies of around 2,600 mmcfd, illustrating the structural imbalance confronting the country.
The country’s dependence on imported LNG has also made it more exposed to disruptions beyond its borders.
LNG terminal problems turned a chronic shortage into a crisis
One of the immediate triggers was a July incident involving an LNG floating storage and regasification unit operated by Excelerate Energy off Moheshkhali.
The facility was taken offline after a fire damaged electrical cable systems. The shutdown removed roughly 450 million cubic feet per day of gas supply from the national system.
Reuters reported that the terminal partially restarted in early August, restoring around 115 mmcfd of gas initially—but that was only a partial recovery, not a complete solution.
Bangladesh’s gas distribution company Titas subsequently warned that severe low pressure would continue after LNG supplies to the national grid fell sharply. Local reporting put the resulting RLNG reduction at roughly 550 mmcfd at one point.
The situation became even more complicated when another LNG facility faced operational difficulties and bad weather disrupted LNG deliveries.
By mid-August, reporting indicated that supplies from the country’s two floating LNG terminals had fallen dramatically, highlighting the risks of relying heavily on a small number of import facilities.
The electricity problem is becoming harder to contain
The gas shortage is particularly damaging because natural gas remains a major source of Bangladesh’s electricity generation.
Bangladesh Power Development Board data show that gas-fired plants account for about 42% of installed power-generation capacity as of August 2026.
When gas supplies fall, power generators cannot simply operate normally.
The Daily Star reported that at least 62 generating units were facing fuel shortages during the height of the recent disruption, including gas-, liquid-fuel- and coal-fired plants. The publication reported an average electricity-generation shortfall of about 1,482 MW during one week, compared with 320 MW the previous week.
That has translated into longer and more widespread power cuts.
Reuters reported on Aug. 13 that Bangladesh was introducing stricter electricity-conservation measures as gas shortages and power outages worsened.
For ordinary households, the problem is therefore two-sided: gas may be unavailable for cooking, while electricity may also disappear when gas-fired power plants cannot obtain enough fuel.
Factories are paying the price
The industrial consequences could be even more significant.
Bangladesh is the world’s second-largest garment exporter, and its apparel sector accounts for roughly 80% of the country’s export earnings, according to the CNA report.
Factories that depend on reliable gas supplies have been forced to reduce production or suspend operations.
The country’s fertiliser industry is also under pressure.
CNA reported that the Ashuganj Fertilizer and Chemical factory in Brahmanbaria has remained closed since March 2025. The plant previously employed more than 1,200 workers and produced more than 1,000 tonnes of urea fertiliser a day.
The shutdown is more than an industrial story: fertiliser availability is directly connected to agricultural production and food security.
Even transportation is being affected
The shortage is also reaching Bangladesh’s roads.
Compressed natural gas, or CNG, is widely used by vehicles, including three-wheelers and other commercial transport.
Reports during the crisis described long queues at CNG filling stations as operators struggled to obtain sufficient gas. Titas warned that reduced supplies could affect CNG stations alongside households, industries and power-generation facilities.
That creates another economic ripple effect: when transport operators spend more time waiting for fuel, commuters and businesses can face delays and higher operating costs.
The global energy market is making matters worse
Bangladesh’s domestic supply problems are occurring at an especially difficult time for global LNG markets.
Reuters reported in July that QatarEnergy had halved scheduled 2026 LNG deliveries to Bangladesh amid disruptions associated with the conflict involving Iran and the resulting problems affecting shipping through the Strait of Hormuz.
Bangladesh had received 19 Qatar-linked LNG cargoes under long-term contracts before the conflict escalated, but none had arrived under those arrangements since Feb. 28 at the time of the Reuters report. The country consequently turned increasingly to spot-market purchases.
That matters because spot LNG can be considerably more expensive and volatile than long-term contracted supplies.
Earlier Reuters reporting also showed Bangladesh purchasing additional LNG cargoes at elevated prices as it attempted to compensate for disrupted supplies.
Why Bangladesh cannot fix the problem overnight
The deeper problem is domestic gas production.
Bangladesh still has gas resources, including offshore prospects, but developing new fields takes time and significant investment.
Energy experts cited by CNA said production could potentially be increased from existing fields, but sustained improvement would require new exploration and drilling. One expert estimated that a single new well could cost roughly US$12 million to US$16 million, while potentially recovering gas worth billions of dollars.
The government has announced plans involving additional drilling capacity and offshore exploration.
But even successful exploration would not immediately solve today’s shortages.
That leaves Bangladesh facing a difficult balancing act: secure expensive imported LNG in the short term while investing in domestic production and alternative energy sources for the longer term.
The bigger warning for Bangladesh
The current crisis reveals a vulnerability that goes beyond temporary gas shortages.
Bangladesh’s economy has become increasingly dependent on reliable energy supplies, yet its domestic gas production is declining and its LNG infrastructure remains exposed to technical failures, weather disruptions and international geopolitical shocks.
The government is therefore being pushed toward three simultaneous priorities:
First: restore and stabilize LNG infrastructure.
Second: accelerate domestic gas exploration and production.
Third: reduce the economy’s dependence on natural gas by expanding renewable and alternative energy sources.
Petrobangla chairman Md Abdul Mannan told CNA that the long-term answer ultimately lies beyond gas and in a transition toward renewable energy, although he could not give a firm timetable for that transition.
For now, however, Bangladesh remains caught between declining domestic supplies and an increasingly uncertain international LNG market.
And that is why the country’s gas crisis could prove much bigger than a temporary shortage.
What happens next?
The immediate question is whether LNG supplies and damaged infrastructure can be restored quickly enough to reduce pressure on power generation, industry and households.
The bigger question is whether Bangladesh can use this crisis as a turning point—or whether the country will continue moving from one energy shortage to the next as domestic gas fields decline and international fuel markets become more unpredictable.
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