WB grants $350m to bolster Bangladesh LNG supply, energy stability
Published: 19 May 2026, 1:53:55
The World Bank (WB) has approved an additional 350 million dollars in financing to help Bangladesh secure liquefied natural gas supplies and reinforce its energy security as global fuel markets remain volatile.
The funding, cleared on 15 May under the Energy Sector Security Enhancement Project, is designed to help Bangladesh manage rising risks in international energy markets and reduce exposure to costly short-term LNG purchases.
The World Bank formally announced the decision on 18 May.
Bangladesh depends heavily on imported LNG to power its electricity plants and sustain industrial output. However, ongoing tensions in the Middle East have disrupted global energy flows, increasing price swings and supply uncertainty.
According to the World Bank, these pressures have strained the country’s foreign exchange reserves and added stress to public finances. A prolonged conflict could also affect fuel and fertiliser availability, with low-income households expected to bear the brunt of higher costs.
The newly approved funds will support more efficient LNG procurement strategies and strengthen payment support for Petrobangla, the state-owned energy company responsible for oil and gas operations.
By enabling the company to secure longer-term LNG contracts, the financing aims to reduce reliance on expensive spot market purchases and provide greater price predictability.
The package is structured as a financing facility backed by an International Development Association payment guarantee. It will offer payment security tools, including standby letters of credit and short-term credit lines, to facilitate LNG imports.
The World Bank said these measures are expected to help Bangladesh transition toward more stable, longer-term LNG supply agreements while retaining flexibility to respond to market disruptions.
Ensuring a steady and affordable power supply is seen as critical for supporting industrial activity, private sector expansion and job creation across the country.
The original 350 million dollar Energy Security Enhancement Project was approved by the World Bank Board on 18 June 2025 and is scheduled to run through 31 December 2031.
