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Dhaka, Apr 23: Bangladesh, where soaring prices of fuel and commodities have set off violent protests, said on Sunday another hike in petroleum prices may come soon.

''We may have no alternative but to raise domestic fuel prices following continuing rise in oil prices in the international markets,'' Mahmudur Rahman, government's energy adviser, told Reuters.

Bangladesh, which last raised retail prices in September last year, has been caught by oil prices scaling record highs above $75 a barrel because it imports all its oil needs.

''The soaring price in global markets is ringing an alarm for us.

It will have a chain effect on everything in our country as well,'' Mahmudur said.

Bangladesh had little choice but to raise prices, he said, despite the likelihood of a public backlash in a country already caught up in violent opposition protests.

Prices of food and other commodities have risen by up to 40 percent since January and a previous government plan to raise fuel costs, in February, was cancelled due to protests.

''The issue is sensitive. We are reviewing it but may have to proceed with a raise,'' Mahmudur said, adding the prime minister would have to approve any price increases.

The government is keen to avoid anything that would inflame opposition protests ahead of an election due next January, officials and analysts say.

Sixteen people, mostly farmers, have been shot dead by police in Bangladesh's north in the past four months, during demonstrations demanding reduced prices and adequate supplies of diesel to run irrigation pumps.

The International Monetary Fund, World Bank and Asian Development Bank last month asked Bangladesh to raise state-regulated fuel prices to ease dependence on aid.

They have also pressed Bangladesh to cut fuel subsidies -- pushing prices up further -- to free up cash to pursue development objectives and help the poor.

Over the last two years Bangladesh has raised prices only enough to pass on between a half and two-thirds of the increase in world oil prices, officials said.

The lagging increases have squeezed energy companies, who are struggling to repay bank loans which, in turn, has squeezed the Bangladeshi money market, they said.

Bangladesh Petroleum Corporation (BPC), a state-run importer and distributor, is struggling to repay more than 50 billion taka ($714 million) to Sonali Bank, a largest state owned commercial bank, officials said.

Mahmudur said, at current prices, BPC stood to lose 37 billion taka ($530 million) this year.

Bangladesh's oil import bill in the fiscal year to the end of June 2005 grew 23 percent to $1.56 billion and could climb to $2 billion this year because of the spiralling international oil prices.

It last increased prices of diesel, kerosene, petrol, octane and furnace oil in September 2005, by an average 16.7 percent, energy officials said.

REUTERS