Bangladesh's Power Crisis Exposes Energy Vulnerability Amid Political Instability

Bangladesh is facing its worst power crisis since Tarique Rahman took office in February 2026. The country's energy vulnerability has been exposed by a series of disruptions, including a fire at Excelerate's Moheshkhali LNG terminal and rough seas idling the second floater.

The crisis is not due to a lack of electricity generation capacity, but rather insufficient fuel to operate the plants. Bangladesh requires around 3,800 million cubic feet of gas each day, but supply fell to barely half this level during the recent crisis.

The country's dependence on imported liquefied natural gas (LNG) has made it vulnerable to international developments. The war between the United States, Israel and Iran disrupted shipping through the Strait of Hormuz, leading to a force majeure declaration by QatarEnergy, which supplied close to 60% of Bangladesh's LNG.

The consequences of the crisis are far-reaching, with around 900 textile mills suspending operations in August 2026. Industry groups estimated daily losses of ৳400 to 500 crore (S$41.2 to S$51.5 million), and the energy shock is projected to add US$4.8 billion to Bangladesh's annual import bill.

The burden of the crisis has been unevenly distributed, with rural Bangladesh absorbing most of the load shedding. Electricity supplies in Dhaka remained relatively stable, but public frustration has produced attacks and demonstrations around Palli Bidyut offices in several districts.