The government is set to keep fuel prices unchanged for April, despite a recent uptick in international oil markets, prioritising public relief over immediate price adjustments, according to the Energy and Mineral Resources Division (EMRD).

In recent days, authorities concerned had been considering a partial alignment of domestic fuel prices with global trends, which would have led to a price increase.

However, the move has now been shelved in view of mounting public hardship, officials said.

Fuel stock remains stable as nationwide drives intensify against illegal hoarding

Sources at the energy division confirmed that, even with a significant subsidy burden, the government is leaning towards maintaining existing prices for the month of April.

A circular has been issued this evening, to this end, stating that based on the "Fuel Pricing Guidelines", the government has determined and approved the consumer-level retail prices for fuel.

The price of diesel remains at Tk100 per litre, octane at Tk120 per litre, petrol at Tk116 per litre, and kerosene at Tk112 per litre.

The circular further states that these prices remain unchanged and will continue to be effective from 1 April.

The notification was signed by Enamul Huq, senior assistant secretary of the EMRD, and was addressed to the chairman of the Bangladesh Petroleum Corporation.

Yesterday, the EMRD had said the government was reviewing proposals from state-owned distributors to adjust fuel prices, while simultaneously assessing the subsidy implications under multiple pricing scenarios.

"We have received the proposal from distributors regarding a fuel price adjustment. We are now examining it carefully," EMRD Joint Secretary Monir Hossain Chowdhury told a press conference at the Ministry of Power, Energy and Mineral Resources.

The discussion on hiking fuel prices comes in the face of a global crisis stemming from the Middle East war. In order to cope with energy shortages, prices have increased in many neighbouring countries, and some countries have even shut down educational institutions due to energy shortages.

Earlier, Home Minister Salahuddin Ahmed said keeping fuel prices unchanged in the country, despite their rise in international markets following the Middle East war, was a major success of the government.

The government has reiterated that Bangladesh faces no actual fuel shortage, even as the ongoing conflict in the Middle East disrupts global energy markets, maintaining that supply remains stable and manageable with plans underway to build longer-term reserves, including a 90-day fuel stock.

Officials stressed that recent supply pressures are largely the result of hoarding by a section of traders, creating artificial scarcity rather than reflecting real deficits.

Energy Minister Iqbal Hasan Mahmud said that supply constraints at times were due to logistical delays rather than a lack of fuel. "There is enough fuel… people will get it, but they should not buy more than necessary," he said, urging consumers to avoid panic purchases.

State Minister for Power, Energy, and Mineral Resources Anindha Islam Amit said that long queues at filling stations were caused by a sudden spike in demand.

He urged consumers to avoid stockpiling, reassuring them that both fuel and electricity remain stable.

The state minister said around Tk167 crore is being spent daily to stabilise fuel prices and ease public suffering, as any price hike would immediately increase electricity tariffs, transport fares and food prices.

Recent fuel arrivals

Early today (31 March), a Panama-flagged vessel, PVT Solana, carrying 30,000 tonnes of diesel from Malaysia, berthed at Chattogram Port, marking the eighth fuel shipment to arrive this month.

The Bangladesh Petroleum Corporation (BPC) confirmed that the diesel may be unloaded either via lightering or directly at the dolphin jetty, with final arrangements pending.

Another vessel carrying a similar quantity is expected on 3 April, while a ship transporting around 70,000 tonnes of LNG is due on 4 April. Over the past month, 33 vessels have docked, including 15 carrying fuel oil, eight with LNG, and nine transporting LPG.

Officials said that Bangladesh Petroleum Corporation plans to boost diesel imports from India's Numaligarh Refinery, while Petrobangla has secured nine LNG cargoes for April.

Govt plans strategy to battle crisis

State Minister for Foreign Affairs Shama Obead Islam outlined the government's multi-pronged strategy to secure an uninterrupted fuel supply and strengthen reserves.

Bangladesh is actively engaging with multiple countries – including Saudi Arabia, India, Malaysia, Indonesia, the United States, and Russia – to ensure continued imports.

Several consignments are expected in April under existing agreements and memorandums of understanding.

On fuel imports from Russia, the state minister said the issue of sanctions requires procedural considerations, including engagement with the United States, adding that the relevant ministries are in discussions to resolve such matters.

"There is no fuel crisis at the moment. We have sufficient reserves, and efforts are underway to strengthen our stock further," she said, emphasising that traders creating artificial pressure must be addressed strictly.

India's real GDP growth for the next fiscal (2026-27) could erode by around one percentage point, while retail inflation could rise by about 1.5 percentage points from their baseline estimates if the West Asia conflict persists through the next fiscal, consultancy firm Ernst & Young report said.

The EY Economy Watch report said several sectors, including employment-intensive sectors like textiles, paints, chemicals, fertilisers and cement could be directly impacted.

Any reduction in employment or incomes in these sectors may further dampen aggregate demand. As a result, both supply and demand conditions may be adversely affected by global oil market disturbances, the report added.

It said the Indian economy, which imports nearly 90% of its crude oil requirements, is also highly dependent on imports of natural gas and fertilisers and is particularly vulnerable to such external shocks, with the adverse effects likely to cascade across multiple sectors through strong forward and backward linkages with crude oil and energy.

EY, in its February report, projected India's GDP could be between 6.8% and 7.2% in the 2026-27 fiscal.

The Indian government has already set up a Rs1 lakh crore economic stabilisation fund to act as a financial cushion against global headwinds.

The securities regulator has approved a proposal from non-listed Akij Food & Beverage Ltd to raise Tk 5 billion by issuing zero-coupon bonds, a move that reflects the growing reliance of large corporations on alternative financing instruments.Financial literacy course

According to the regulatory approval, the bond will be unsecured, non-convertible, and fully redeemable. Unlike conventional bonds, this instrument does not offer periodic interest payments. Instead, the bond is issued at a discounted price and redeemed at full face value upon maturity, allowing investors to earn a fixed return.

The approval came at a meeting of the Bangladesh Securities and Exchange Commission (BSEC) last week, presided over by its Chairman Khondoker Rashed Maqsood.

The tenure of the bond will range from six months to 60 months, providing flexibility for investors with varying investment horizons.

The bond units will be issued through private placement to banks, non-bank financial institutions, insurance companies, institutional investors, and high net-worth individuals. Each unit will carry a face value of Tk 1 million, effectively limiting participation to large-scale investors.

Sena Insurance has been appointed trustee, responsible for safeguarding investors' interests and ensuring regulatory compliance, while North Star Investments (BD) will act as the fund manager.Bangladesh market analysis

Market insiders said amid tighter banking liquidity and relatively high borrowing costs, corporations are actively diversifying funding sources. Structured instruments such as zero-coupon bonds allow issuers to better align repayment obligations with long-term revenue generation.

The proceeds from the issuance are expected to support the company's expansion and operational financing needs, although detailed utilisation plans were not disclosed. This would be a cost-efficient way to fund expansion without immediate interest servicing burdens.

Founded in 2006, Akij Food & Beverage has grown into one of the country's leading beverage manufacturers. Its portfolio includes several well-known brands such as Mojo, Frutika, and Speed, which enjoy a strong market presence across segments.

City Sugar Industries Limited, a concern of City Group, has received regulatory approval to raise Tk1,300 crore through a three-year zero-coupon bond.

The approval was granted by the Bangladesh Securities and Exchange Commission (BSEC) at a meeting today (30 March), according to a press release.

The proposed bond will be secured and mortgage-backed, non-convertible, and fully redeemable, with an estimated discount rate of around 13.50%. Under the structure, the company will provide land as collateral, offering enhanced security to investors.

The bond will be issued through private placement to corporate entities, high-net-worth individuals, banks, financial institutions, and insurance companies. Each unit of the bond will carry a face value of Tk13 lakh.

Officials said the proceeds from the bond issuance will be used to repay existing liabilities with various banks and financial institutions, helping the company restructure its debt and improve financial stability.

BRAC EPL Investments Limited has been appointed as the trustee of the bond, while BRAC Bank will act as the arranger. The bond is also expected to be listed on the Alternative Trading Board, providing a platform for secondary market trading.

Syed Rashed Hussain, chief executive officer of BRAC EPL Investments, said the mortgage-backed nature of the bond ensures a higher level of security for investors.

He explained that the company's land will be transferred under the trustee as collateral, and in case of default, the trustee will have the authority to liquidate the assets to repay investors.

He added that this is the first instance of a mortgage-backed bond issuance in Bangladesh, setting a precedent in the local capital market and potentially opening the door for similar structured financing instruments in the future.

Earlier, City Auto Rice and Dal Mills Limited, another concern of City Group, issued a Tk350 crore bond for repaying the debt.

Market analysts believe the move reflects a growing trend among corporates to explore alternative financing options beyond traditional bank loans, while also offering investors more secure investment avenues.

The interim government's reliance on the banking sector surged significantly to meet development project costs and other expenditures, with borrowing from internal banks reaching over Tk73,000 crore in the first seven months of the current fiscal year, FY2025-26.

According to a report from Bangladesh Bank, 81% of the government's total domestic and foreign loans between July and January were sourced from the internal banking system. The total net borrowing from both local and international sources stood at approximately Tk90,000 crore during this period.

Economists warn that excessive government borrowing from banks can crowd out the private sector, discouraging investment and creating pressure for interest rate hikes. This comes at a time when private sector credit flow has already hit a record low due to political instability ahead of the 13th national elections.

Central bank officials identified several factors behind the rapid increase in bank loans. A primary reason is the government's capital support for the "Combined Islamic Bank," formed by merging five banks. In the first week of last December, the government injected approximately Tk 20,000 crore into the bank, a large portion of which was financed through bank borrowing.

Additionally, while revenue collection fell short of targets in the first half of the fiscal year, operating expenses rose significantly, forcing the interim government to lean more heavily on the banking sector.

The government proposed a budget of Tk7.90 lakh crore for the FY2025-26, with an overall deficit (including grants) of Tk2.21 lakh crore, or 3.5% of GDP. To bridge this gap, the government planned to borrow Tk1.25 lakh crore from domestic sources, including Tk1.04 lakh crore from the banking system and Tk21,000 crore from non-banking sources.

However, data shows a sharp shift in borrowing patterns.

Net borrowing reached Tk73,035 crore from July to January, nearly an eight-fold increase compared to Tk9,442 crore during the same period of the previous fiscal year.

Borrowing from non-banking sources plummeted to Tk7,216 crore, down from Tk25,864 crore in the previous year.

The total stock of domestic debt stood at Tk10.37 lakh crore as of January 2025, an increase of over Tk1.51 lakh crore within a single year.

The report also highlighted a dwindling contribution from external sources. In the first seven months of FY2025-26, net foreign borrowing amounted to only Tk9,832 crore, accounting for less than 11% of total loans.

In contrast, the government had secured approximately Tk27,964 crore from foreign sources during the same period in the previous fiscal year.

Experts emphasised the need for a balanced debt management strategy to attract private investment and ensure long-term economic stability.

The Bangladesh Securities and Exchange Commission has approved the issuance of an Orange bond, the first of its kind in the country, by SAJIDA Foundation to raise Tk 158.5 crore to finance women's economic empowerment and accelerate progress towards gender equality.

The zero-coupon bond, a debt that pays no interest but is sold at a deep discount, marks a major milestone in Bangladesh’s capital market evolution, said a press release by BRAC EPL Investments Ltd.

SAJIDA Foundation partnered with BRAC EPL Investments Ltd and Impact Investment Exchange (IIX), the Singapore-based global impact investing platform, to issue the Orange bond, a specialised investment tool designed to raise money specifically for empowering women, girls, and gender minorities while tackling climate change.

“The pioneering bond supports the transition toward more inclusive, resilient, and capital market-driven development finance solutions, and contributes to broader efforts to develop the impact investment ecosystem in Bangladesh,” said the press release.

BRAC EPL Investments Ltd said Bangladesh’s bond market has long been dominated by government securities and bank subordinated debt. This transaction breaks that mould by introducing thematic, impact-linked fixed income as a new asset class.

The bond offers investors tax-exempt financial returns while enabling measurable social impact, particularly in supporting women and women-led businesses.

Some 48 percent of the proceeds will be allocated to food security and agriculture, 32 percent to women-led SMEs, and 20 percent will be used for climate-resilient housing across 36 districts.

“Impact will be tracked through independently verified annual reports aligned with international standards, ensuring transparency and tangible benefits for women’s economic empowerment.”

Minister for Power, Energy and Mineral Resources Iqbal Hasan Mahmud Tuku stated in a parliamentary session today (30 March) under Rule 300 that the government has taken the initiative to import 50,000 tonnes of octane in April.

Additionally, the government announced that another 30,000 tonnes of octane will be supplied from domestic sources.

As a result, even though the monthly demand is 35,000 tonnes, the current management will ensure an additional reserve for at least two months.

The minister said that although global instability – particularly tensions in the Middle East – has created pressure on the global fuel supply, Bangladesh has kept the situation under control through advanced preparation, consistent imports and effective management.

The minister noted that despite the increase in prices on the international market, fuel prices have not been raised domestically.
Keeping fuel prices stable a major success of govt: Salahuddin

Currently, while the selling price of diesel is Tk100 per litre, the actual cost is approximately Tk198. The government is also providing subsidies for octane.

The minister stated that for the March-June quarter, a total subsidy of Tk15,409 crore will be required for diesel, and Tk636 crore for octane, totalling Tk16,045 crore.

"Furthermore, for LNG imports through Petrobangla, a subsidy of Tk15,077 crore will be required for the April-June quarter. This government believes the state's primary responsibility is to stand by the people during crises and ensure their protection," he added.
What’s driving our hoarding instinct in the ongoing fuel crisis?

The minister said, "I want to reassure the nation through this parliament that fuel prices have not been increased in the country despite the foreign crisis. Many countries around the world have had to adjust fuel prices repeatedly. Even in many neighbouring countries, prices have increased by more than 25%."

He emphasised that the Bangladesh government has prioritised the public interest and kept prices stable, because if fuel prices rise, the cost of agricultural production, transport and the general public's cost of living increases manifold.

The discussion on hiking fuel prices comes in the face of a global crisis stemming from the Middle East war. In order to cope with energy shortages, prices have increased in many neighbouring countries, and some countries have even shut down educational institutions due to energy shortages.

Earlier, Home Minister Salahuddin Ahmed said keeping fuel prices unchanged in the country, despite their rise in international markets following the Middle East war, was a major success of the government.

Asian stock markets fell while oil prices surged today (31 March) as the ongoing war involving Iran continued to rattle global markets and drive up energy costs.

South Korea's benchmark Kospi index dropped sharply by 3.82%, losing more than 200 points to stand at 5,075.92 around 01:00 GMT.

Japan's Nikkei 225 also declined 2.24% in early trading before recovering slightly, though it remained down 0.73%, or 377 points, at 51,507.99.

China's FTSE China A50 Index edged lower as well, slipping between five and 10 points, or less than 0.07%, to hover around 14,570.

Meanwhile, oil prices climbed amid supply concerns linked to the conflict.

The US benchmark West Texas Intermediate rose 1.08% to $103.99 per barrel, crossing the $100 mark for the first time since the war began. International benchmark Brent Crude jumped 2.23% to reach $109.78 per barrel.

Rising crude prices have translated into higher fuel costs in the United States.

The average retail gasoline price has exceeded $4 per gallon for the first time in more than three years, according to data cited by Reuters from fuel tracking service GasBuddy.

Since the US-Israel war involving Iran began on February 28, gasoline prices across the US have surged by about $1.06 per gallon, marking a 36% increase.

The last time prices reached the $4 threshold was in August 2022, following the outbreak of the Russian invasion of Ukraine.

During his 2022 campaign to return to the White House, Donald Trump had pledged to cut energy costs and boost domestic oil and gas production, a promise now facing renewed scrutiny amid the latest price spike.

Oil companies will have to look further afield for new fossil fuel resources now that the Iran war has dented the investment allure of the energy-rich Middle East. Higher oil prices will give them that chance.

Major international oil companies, including Exxon Mobil, Chevron, TotalEnergies, Shell and BP, have long been drawn to the Middle ​East by its vast resources, stable fiscal terms and, until recently, relative political stability. The region accounts for roughly a fifth of global oil and liquefied natural gas (LNG) production.

That reputation, built painstakingly ‌over decades even as wars raged in Iraq and Yemen, has now been shattered by the US-Israeli war with Iran.

Now in its fifth week, the conflict has put energy infrastructure squarely in the crosshairs. Dozens of facilities across the Gulf have been damaged, including Qatar’s giant LNG hub and several major oil refineries.

The closure of the Strait of Hormuz - through which roughly 20 percent of the world’s oil and gas normally flows - has forced producers to shut oilfields, costing the region an estimated $1 billion a day in lost export revenues, according ​to Reuters calculations based on pre‑war prices.

The longer‑term costs will be far higher. Restarting operations and repairing damaged facilities will likely run into the tens of billions of dollars - if not far ​more. QatarEnergy said an Iranian missile strike on February 18 could cost it about $20 billion a year in lost revenue and take up to five years to repair.

But no amount of money may be able to repair the region’s reputational damage – at least not in the short term – and that is likely to rapidly reshape Western energy majors’ upstream strategies.

The ​Middle East will clearly remain a major source of oil and gas for decades. It holds about half of the world’s proven oil reserves and 40 percent of gas reserves. Western companies are thus unlikely to abandon ​it altogether.

It currently makes up a substantial portion of many majors’ portfolios, including 41 percent of Exxon’s reserves, 42 percent of TotalEnergies’ and a quarter of Shell’s, according to consultancy Welligence. The region attracted around $130 billion in oil and gas investment in 2025, roughly 15 percent of the global total, according to the International Energy Agency.

But unless the Iran war ends with a new, non-belligerent government sitting in Tehran - an outcome that currently appears remote - the conflict will leave deep scars. Uncertainty over the safety of transit ​through Hormuz and the higher risk of conflagration is apt to sharply boost the cost of deploying staff, equipment, insurance and capital in the Middle East, making the region a lot less attractive for exploration.

This ​rising risk premium in the world’s largest energy-producing region is already being reflected in long-term oil prices.

Since the eve of the conflict, the average Brent crude price expected in 2030 has jumped about 10 percent to roughly $72 a barrel. Once the ‌full extent of the damage from the war is known, that could rise even further.

A structurally higher oil price would change the upstream calculus for the world’s energy giants.

This shift comes as the industry’s appetite for new oil and gas investment has been strengthening. Over the past year, oil companies have significantly increased spending on exploration worldwide - from West Africa and the eastern Mediterranean to Brazil and Southeast Asia.

That was a sharp break from the prior decade, when shareholder pressure and fears of a rapid demand decline driven by the energy transition reduced upstream investment. Today, companies – spurred by new outlooks suggesting fossil fuel demand won’t peak until next decade – are ​increasingly confident that more supply will be needed through ​the end of the decade.

Of course, exploration remains ⁠a high‑risk, high‑reward business requiring heavy upfront investment. Projects can also often take more than a decade to progress from the first drilling campaign to production.

Still, higher long-term prices would expand the pool of economically viable reserves worldwide. And, importantly, the spiking risk premium in the Middle East is likely to push more ​capital toward regions previously deemed more risky or marginal.

Venezuela offers a case in point. Its oil industry reopened to Western companies after the US deposed President Nicolas ​Maduro in January, yet investment in ⁠the country has remained tepid given political uncertainty and concerns over the sector’s dilapidated infrastructure.

In a more bullish price environment, however, Venezuela’s vast resources could suddenly appear more appealing – particularly if the relative geopolitical risk gap between Venezuela and the Gulf shrinks.

The energy industry has been through such a geographic reshuffle before. After 2022, the Middle East gained importance when Western companies were forced to exit Russia following Moscow’s full‑scale invasion of Ukraine.

The Iran war now threatens to ⁠trigger another realignment - ​pushing companies to cast their investment nets wider than they have in years. But if the response this time around is ​to move into riskier or costlier areas, the floor on energy prices is likely going up.

Unpredictable tax practices, weak enforcement, and conflicting regulatory directives continue to raise costs and delay operations for businesses, Japanese investors said yesterday.

Speaking at an event at The Westin Dhaka, marking the Japan Business Day, they argued that without policy continuity, transparent administration, and reliable dispute resolution, long-term investment decisions remain at risk. The programme was jointly organised by the Embassy of Japan, Bangladesh and Japan External Trade Organisation (Jetro).

“Clear, consistent and fairly applied rules are vital to improve Bangladesh’s investment climate. Uncertainty often outweighs product competitiveness,” said Manabu Sugawara, president of Japanese Commerce and Industry Association in Dhaka (JCIAD), commonly known as Shoo-Koo-Kai.

He identified tax reform as a priority, calling for simpler procedures, clearer interpretations and reduced discretionary practices, alongside faster services and reliable dispute resolution.

Sugawara highlighted poor coordination among government agencies, saying conflicting directives create delays and raise costs for investors.

He also urged a functional one-stop service with fully digital, streamlined and time-bound approvals, licensing and renewals.

Pointing to persistent visa and permit delays, he said such bottlenecks must be resolved quickly.

Hiroshi Uegaki, country representative of Mitsubishi Corporation, one of Japan’s corporate giants, called for foundational reforms to strengthen Bangladesh’s investment climate for Japanese firms.

He stressed improving data management, business efficiency and digitalisation aligned with international standards to reduce delays.

Uegaki highlighted the importance of economic partnership agreements (EPAs) to ease import-export processes and support smoother operations.

Policy consistency, he added, remains critical to ensure long-term investor confidence and signal a stable, business-friendly environment.

Tareq Rafi Bhuiyan, president of the Japan-Bangladesh Chamber of Commerce and Industry, said the EPA would ensure continued market access to Japan and strengthen investor confidence through a rules-based framework.

The Bangladesh–Japan EPA is being seen as critical to sustaining trade and investment as Bangladesh prepares for LDC graduation, he said. “Investors value predictability and long-term trust,” he noted, adding that reforms must align with EPA commitments to attract sustained Japanese investment.

Also speaking at the event, Rashed Al Mahmud Titumir, the prime minister’s adviser on finance and planning, pointed out priorities to deepen Bangladesh–Japan economic ties and shift focus from aid to investment-led growth.

He said Bangladesh wants higher Japanese investment to match global averages, with a stronger emphasis on manufacturing to create sustainable jobs.

He also stressed the need for greater technology transfer through joint ventures, enabling long-term industrial capacity and competitiveness. Titumir added that the government is committed to policy reforms, including deregulation, stronger market-based oversight, and improved contract enforcement to build investor confidence.

Ashik Chowdhury, executive chairman of the Bangladesh Investment Development Authority (Bida), outlined a set of reforms aimed at attracting sustained foreign investment, particularly from Japanese firms.

He said improving the business climate would require making tax administration more transparent and efficient, reducing the burden of unpredictable enforcement. He also stressed the need for stronger coordination among government agencies to avoid conflicting directives that often delay operations.

Chowdhury called for a fully functional “one-stop service” to streamline licensing through digitalisation and ensure visa processing within a predictable timeframe. Policy consistency, he added, remains crucial for long-term corporate planning and boosting investor confidence.

Japanese Ambassador to Bangladesh Shinichi Saida described the recently signed bilateral EPA as a landmark step, urging Bangladesh to view it through a long-term lens rather than immediate gains.

He said the deal offers legal certainty for investors and reinforces a rules-based trade environment at a time of global uncertainty.

Meanwhile, presenting the findings of a survey on business conditions of Japanese firms, Kazuiki Kataoka, country representative of Jetro, said Bangladesh is emerging as a promising frontier for Japanese businesses, with stronger profit expectations and growing interest in expansion.

He noted that 56.9 percent of Japanese firms in Bangladesh plan to expand operations, driven largely by the country’s rising domestic market.

He also pointed to administrative inefficiencies and policy uncertainty as major risks, stressing that improving these areas could unlock greater foreign investment.

Syed Nasim Manzur, managing director of Apex Footwear Limited, said Bangladesh should position itself as a manufacturing hub, exporting to Japan and integrating into global value chains.

Leveraging the EPA, he added, could deepen long-term partnerships and boost trade and services.

M Masrur Reaz, chairman and CEO of Policy Exchange of Bangladesh (PEB), said Bangladesh’s prospects under the proposed economic partnership with Japan remain promising, but some weaknesses could blunt its gains.

He said weak inter-agency collaboration, fragmented public-private dialogue, and limited private-sector linkages undermine policy execution and investment climate reforms.

The war in Iran has sparked chaos across financial markets, leaving some investors and market makers reluctant to take on risk, making trading harder and costlier - a scenario regulators watch closely.

None of the world's biggest markets, from US Treasuries, to gold, to currencies have been spared, investors and traders said. In Europe, hedge funds, which now dominate bond trading, added to those dynamics as they rapidly unwound a number of bets this month.

Investors say they have at times struggled to get prices, or execute trades over the past four weeks, as market makers fear being stuck with large positions that could quickly become unprofitable.

"When we try to trade, it takes longer to trade. (The market makers) want us to be more patient, cut the trades into smaller sizes," Rajeev De Mello, chief investment officer at GAMA Asset Management, said, adding gaps had widened between the price at which market makers would buy an asset and at which they would sell it. "What that has as a consequence is that everybody's reduced the sizes of their positions."

Various measures of volatility have soared to levels seen in previous market crises, including those for stocks, bonds, oil and gold.

Cracks have emerged even in the usually deep and liquid government bond markets, a cornerstone of global finance that has been hit hard as inflation risks spook investors.

The difference between bid and ask prices on newly issued two-year US Treasuries, a key measure of market depth and transaction cost for the most widely traded securities, has meanwhile widened roughly 27% in March, compared with February levels, according to Morgan Stanley, suggesting dealers are charging a higher premium to take on risk.

Pain in futures market

To be sure, the latest symptoms of market stress are not uncommon during bouts of market turmoil, such as during US President Donald Trump's "Liberation Day" tariffs last April and the 2020 COVID pandemic.

But this round of volatility has arrived at a time when markets had been in an expansive mood, as investors rode a runaway rally across asset classes, suggesting a deeper correction may materialise if the war drags on and liquidity evaporates.

In Europe, the pain has been particularly stark in the futures market for short-term interest rates, where traders rapidly priced steep central bank rate hikes.

Liquidity became "severely diminished" at one point, operating at 10% of usual levels, Morgan Stanley's co-head of EMEA rates Daniel Aksan said.

"The (illiquidity, price moves) reminded me of the COVID days," he said.

Three European financial regulators on Friday said ongoing geopolitical tensions, namely the war in the Middle East, pose significant risks to the global financial landscape through higher energy prices, potential inflationary pressures and weaker economic growth. They reiterated their warning about the impact of volatility on liquidity and the risk of sudden price swings.

Protecting bottom lines

Trading has thus far remained orderly, but buyers are becoming increasingly scarce as investors rush to de-risk and move into cash, leaving dealers hesitant in turn.

"Firms have lost so much money - whether it's sell-side or buy-side - that liquidity is suffering because you don't have the players," said Tom di Galoma, managing director of global rates trading at broker-dealer Mischler Financial, referring to the US Treasury market.

While trading volumes in Treasuries have surged, analysts say some of these trades have been done out of necessity, not by choice.

"With a wider bid-ask spread, it is more expensive to put on a trade and would be less attractive for people to enter into trades, but the fact that you still see really high volumes suggest that some of these trades were unwinds, or stop-outs," said Morgan Stanley US rates strategist Eli Carter.

Hedge funds in europe

The particularly sharp selloff in European bonds has also served as an example of the impact hedge funds may have on that market at times of stress, a risk the Bank of England in particular has flagged as their footprint has grown rapidly in recent years.

Hedge funds now make up over 50% of trading volumes in Britain's and euro zone government bond markets, according to the latest Tradeweb data from 2025.

While their presence in the bond markets provides liquidity in good times, many had piled into the same trades, some of which quickly proved loss-making.

Hedge funds took steep losses on betting the BoE would cut rates, three hedge fund investment sources said. They also took hits on trades that bet on steeper European yield curves and on trades that assumed the gap between Italian and German bond yields would stay narrow, Credit Agricole's head of European government bond trading Bruno Benchimol said.

As they all unwound similar positions at the same time, that pushed bond dealers to widen bid-ask spreads, Benchimol added.

When hedge funds all de-risk at the same time "it exacerbates volatility," said Morgan Stanley's Aksan. At other times, they took positions that helped dampen volatility, he said.

Staying in the market

But market makers still have pressure to win business even as clients reduce the frequency and size of trades.

Sagar Sambrani, a senior FX options trader at Nomura, said pricing for larger ticket orders had widened versus normal market conditions to account for market risk. But, "counter-intuitively, the pricing on smaller tickets is tighter than in regular conditions as market makers strive harder to capture the reducing client flows," Sambrani said.

But sometimes this is not possible.

In the gold market, which is highly sensitive to interest rates, Mukesh Dave, chief investment officer at Aravali Asset Management, a global arbitrage fund, said there were days when market makers were absent altogether, indicating an unwillingness to transact.

The price of normally safe-haven gold plunged this month after a record rally in 2025.

"They don't want to make money at the moment, they don't want to lose money by being in the market. If given a choice, they don't want to be in the market," Dave said.

Oil prices extended gains on Monday, with Brent headed for a record monthly rise, after Yemeni Houthis launched their first attacks on Israel over the weekend, widening the US-Israel war with Iran in the Middle East.

Brent crude futures jumped $2.43, or 2.16%, to $115 a barrel by 0342 GMT after settling 4.2% higher on Friday.

US West Texas Intermediate was at $101.50 a barrel, up $1.86, or 1.87%, following a 5.5% gain in the previous session.

"The market has all but discounted the prospect of a negotiated end to the war, Trump's claims of ongoing 'direct and indirect' talks with Iran notwithstanding, and is bracing for a sharp escalation in military hostilities, which is a bullish signal for crude, with huge uncertainties on the timing and nature of the outcome," said Vandana Hari, founder of oil market analysis provider Vanda Insights.

US President Donald Trump said the US and Iran have been meeting "directly and indirectly" and that Iran's new leaders have been "very reasonable", as more US troops arrived in the region, while the Israeli military said on Monday it is attacking the Iranian government's infrastructure throughout Tehran.

Brent has soared 59% this month, the steepest monthly jump, exceeding gains seen during the 1990 Gulf War, after the Iran conflict effectively closed the Strait of Hormuz, a conduit for a fifth of the world's oil and gas supplies.

The war, launched on 28 February with US and Israeli strikes on Iran, has spread across the Middle East, with Yemen's Iran-aligned Houthis on Saturday launching their first attacks on Israel since the start of the conflict, raising concern about shipping lanes around the Arabian Peninsula and the Red Sea.

"The conflict is no longer concentrated in the Persian Gulf and around the Strait of Hormuz, but now extends into the Red Sea and the Bab el-Mandeb — one of the world's most crucial chokepoints for crude and refined product flows," JP Morgan analysts led by Natasha Kaneva said in a note.

Saudi crude exports re-directed from the Strait of Hormuz to the Yanbu port in the Red Sea reached 4.658 million barrels per day last week, data from analytics firm Kpler showed.

If exports from Yanbu were disrupted, Saudi oil would need to pivot towards Egypt's Suez-Mediterranean (SUMED) pipeline to the Mediterranean, JP Morgan analysts said.

Attacks in the region escalated over the weekend and damaged Oman's Salalah terminal despite efforts to start ceasefire talks.

Iran said it was ready to respond to a US ground attack, accusing Washington on Sunday of preparing a land assault even as it sought negotiations.

Pakistan's Foreign Minister Ishaq Dar said they had covered possible ways to bring an early and permanent end to the war in the region as well as potential US-Iran talks in Islamabad.

South Korea's March exports probably rose at the strongest pace in nearly five years on a boom in chip demand fuelled by artificial intelligence investment, although the Iran war was set to drive up imports and inflation, a Reuters poll showed on Monday.

Exports from Asia's fourth-largest economy, a bellwether for global trade, were projected to have risen 44.9% from a year earlier, according to a median forecast of 11 economists.

That would be faster than the 28.7% rise in February and the strongest since May 2021. It would also mark the 10th consecutive month of year-on-year gains.

"Semiconductor prices are continuing to rise sharply on robust demand for memory chips," said Chun Kyu-yeon, an economist at Hana Securities, expecting this year's trade surpluses at record levels.

In the first 20 days of this month, exports rose 50.4%, as semiconductor sales surged 163.9%. Shipments to the US and China rose 57.8% and 69.0%, respectively, while those to the European Union were up 6.6%.

"However, due to the impact of high oil prices, import growth will also be higher than previously projected," said Park Sang-hyun, an economist at iM Securities. "It is expected that there will be some disruption to shipments to the Middle East."

In Monday's monthly survey, imports were forecast to have risen 18.0% in March from a year earlier, after growing 7.5% in February. That would mark the biggest jump since September 2022.

The median forecast for the country's monthly trade balance stood at $21.2 billion, wider than $15.4 billion in the previous month and a record high.

Consumer inflation probably accelerated in March to 2.4%, the fastest pace in four months. Inflation was 2.0% in February.

South Korea is scheduled to report trade figures for March on Wednesday, 1 April, at 9 am (0000 GMT).

Iran’s annual inflation rate rose to 50.6 percent by mid-March, up three percentage points from the previous month, the country’s official statistics centre said on Sunday.

“The inflation rate for the twelve months ending in Esfand (from February 20 to March 20) reached 50.6 percent,”the centre said in a statement carried by the official IRNA news agency.

The rate had stood at 47.5 percent in the previous month, covering the period from January 21 to February 19.

The rise in prices comes with Iran at war with the United States and Israel since February 28, when strikes that killed the country’s supreme leader triggered a conflict that has since spread across the Middle East.

On March 20, Iran marked the start of the Nowruz holidays, the Persian New Year.

More than 1,300 ongoing projects approved by the Executive Committee of the National Economic Council (Ecnec) under previous governments are now under review, Finance and Planning Minister Amir Khosru Mahmud Chowdhury has said.

He made the remarks while responding to a question during the question-and-answer session of the first sitting of the 13th Jatiya Sangsad this afternoon (30 March).

The minister said around 500 of these projects have made less than 10% progress so far.

"Many of the projects involve concerns of waste and corruption, which is why they have been brought under review," he said.

The projects currently being undertaken aim to strengthen the rural economy, he added.

Bangladesh Bank Governor Md Mostaqur Rahman has said he expects to receive funds from the finance ministry in July this year to liquidate six non-bank financial institutions (NBFIs).

He made the remarks at a meeting with senior journalists at the central bank on Sunday. "We expect that the funds required to liquidate the six financial institutions will be received from the finance ministry in July this year," he said.

A senior central bank official told TBS, "The finance division has informed us that the money will be released in two phases. In the first phase, Tk2,600 crore will be provided. Then, by June, another Tk3,000 crore will be released in the second phase."

He added, "As soon as we receive the first tranche, we will appoint administrators to the institutions concerned. Their primary task will be to repay depositors in the private sector. We will first settle individual depositors' funds and then apply to the court for liquidation of the institutions."

Earlier, on 27 January, the Bangladesh Bank board decided to liquidate six institutions. In the same meeting, three institutions were given three to six months' time.

The six NBFIs are FAS Finance, Premier Leasing, Fareast Finance, Aviva Finance, People's Leasing, and International Leasing.

The three institutions given time are Bangladesh Industrial Finance Company, GSP Finance Company, and Prime Finance and Investment Limited.

Currently, there are 35 non-bank financial institutions in the country, of which 20 have been identified as distressed by the central bank.

These 20 institutions have total loans amounting to Tk25,808 crore, of which Tk21,462 crore – about 83.16% – are defaulted. In contrast, the value of collateral stands at only Tk6,899 crore.

On the other hand, the 15 relatively healthy institutions have a default loan rate of just 7.31%. Last year, they made a profit of Tk1,465 crore and have a capital surplus of Tk6,189 crore.

Deposits in the 20 troubled institutions total Tk22,127 crore, of which net individual deposits amount to around Tk4,971 crore. The central bank believes that this amount may be required initially to support the liquidation and restructuring process.

The dollar was near a 10‑month high on Monday and heading for its biggest monthly gain since last July ​as mixed signals from Iran and the United States dimmed hopes of a possible quick end to the ‌Middle East conflict.

US President Donald Trump said that Iran's new leaders have been "very reasonable", as more US troops arrived in the region and Tehran warned it will not accept humiliation.

The yen hovered near the key 160 per‑dollar level, after hitting its weakest since July 2024 when Tokyo last intervened to shore up the currency, while ​the euro found some support from expectations of European Central Bank rate hikes.

Markets have been rattled this month after the Iran conflict effectively ​shut the Strait of Hormuz, a chokepoint for about a fifth of global oil and gas flows, driving Brent ⁠crude toward a record monthly rise.

The dollar has benefited from its safe‑haven status since early March, with higher oil prices hurting Japan ​and the euro zone but insulating the United States as a net crude exporter.

The US dollar index was roughly unchanged at 100.19. It ​hit 100.54 in mid-March, its highest level since May 2025, and was on track for its biggest monthly rise since July 2025.

Barclays said dollar sentiment was approaching "max bullish" levels on its index, according to traditional gauges including growth proxies, rate differentials and beta indicators.

"The playbook is to sell rallies in risk and ​maintain volatility hedges," said Chris Weston, head of research at Pepperstone.

Markets will closely watch US jobs data later in the week, which could ​affect expectations for the Federal Reserve policy path.

"In the eye of the storm, this week delivers a crucial run of US labour market data," said ‌Bob Savage, ⁠head of markets macro strategy at BNY.

"Given the weak February jobs report and a month of conflict in the Middle East, we’re keen to learn how the jobs situation has responded," he added.

Foreign aid disbursement to Bangladesh fell by 26 percent year-on-year during the July-February period of the current 2025-26 fiscal year, according to the Economic Relations Division (ERD).

Development partners and international lending agencies released $3.05 billion in loans and grants during this eight-month window, the ERD said in a report published on Monday..

This marks a sharp decline from the $4.13 billion disbursed during the same period in the previous fiscal year.

While the inflow of funds slowed, the burden of repayment continued to climb.

Between July and February, the government paid $2.90 billion in principal and interest on existing foreign debts.

In contrast, debt servicing stood at $2.64 billion during the corresponding months of the last fiscal year.

Economists and ERD officials attribute the slowdown to lingering economic instability following the political transition in 2024.

Oil prices extended gains on Monday, with ​Brent headed for a record monthly rise, after Yemeni Houthis launched their first attacks on Israel over the ‌weekend, widening the US-Israel war with Iran in the Middle East.

Brent crude futures jumped $3.94, or 3.5 percent, to $116.51 a barrel at 0703 GMT after settling 4.2 percent higher on Friday.

US West Texas Intermediate was at $102.14 a barrel, up $1.86, or 1.87 percent, following a 5.5 percent gain in the previous session.

“The market has all but discounted the prospect of ​a negotiated end to the war, Trump’s claims of ongoing ‘direct and indirect’ talks with Iran notwithstanding, and is bracing for ​a sharp escalation in military hostilities, which is a bullish signal for crude, with huge uncertainties on the timing and nature of the outcome,” said Vandana Hari, founder of oil market analysis provider Vanda Insights.

US President Donald Trump said ​the US and Iran have been meeting “directly and indirectly” and that Iran’s new leaders have been “very reasonable”, as more U.S troops arrived in ​the region, while the Israeli military said on Monday it is attacking the Iranian government’s infrastructure throughout Tehran.

Brent has soared 59 percent this month, the steepest monthly jump, exceeding gains seen during the 1990 Gulf War, after the Iran conflict effectively closed the Strait of Hormuz, a conduit for a fifth of the world’s ​oil and gas supplies.

The war, launched on February 28 with US and Israeli strikes on Iran, has spread across the Middle East, ​raising concern about shipping lanes around the Arabian Peninsula and the Red Sea.

The Israeli military on Monday said Iran launched multiple waves of missiles at Israel ‌and an ⁠attack had also been launched from Yemen for only the second time since the war began.

“The conflict is no longer concentrated in the Persian Gulf and around the Strait of Hormuz, but now extends into the Red Sea and the Bab el-Mandeb — one of the world’s most crucial chokepoints for crude and refined product flows,” JP Morgan analysts led by Natasha Kaneva said in a note.

Saudi crude exports ​re-directed from the Strait of ​Hormuz to the Yanbu port ⁠in the Red Sea reached 4.658 million barrels per day last week, data from analytics firm Kpler showed.

If exports from Yanbu were disrupted, Saudi oil would need to pivot toward Egypt’s Suez-Mediterranean (SUMED) pipeline to ​the Mediterranean, JP Morgan analysts said.

Attacks in the region escalated over the weekend and damaged Oman’s Salalah ​terminal despite efforts ⁠to start ceasefire talks.

Iran said it was ready to respond to a US ground attack, accusing Washington on Sunday of preparing a land assault even as it sought negotiations.

Pakistan’s Foreign Minister Ishaq Dar said they had covered possible ways to bring an early and permanent end to the ⁠war in ​the region as well as potential US-Iran talks in Islamabad.

Separately, Vietnam’s Binh Son ​Refining and Petrochemical on Monday said it is in talks with Russian partners to buy crude oil. The company said it would also buy more crude oil from Africa, ​the US and Southeast Asia.