Indonesia: Government to meet on raising the price of subsidised fuel

• Coordinating Economic Minister Darmin Nasution said on 11 Oct 18 the government would soon hold a meeting to decide on whether it will increase the price of the subsidized Premium-branded gasoline after the issue sparked controversy on 10 Oct 18.
• Energy and Mineral Resources Minister Ignasius Jonan announced the price increase of Premium gasoline starting on 10 Oct 18, but less than an hour later, State-Owned Enterprises Minister Rini Soemarno withdrew the announcement, arguing that Pertamina was not ready.
• A press statement from Pertamina has also indicated that the prices of non-subsidised fuels (i.e. RON92 (Pertamax) and Pertamina Dex) will undergo an upward adjustment while those of RON88 (Premium), RON90 (Pertalite) and PSO Biosolar will remain unchanged.
• Rini said her side and state-owned energy holding company Pertamina had not been informed by Jonan about the plan to increase the price of Premium fuel.
• During a press conference, Jonan previously said that the government would increase the price of Premium gasoline, the cheapest fuel in the country, by around 7% throughout the country to IDR7,000 per litre.
• Jonan said on 10 Oct 18 that the price increase could start as early as 10 Oct 18 or depending on the readiness of state-owned energy holding company Pertamina to implement the policy.
• Jonan said the decision was made after the price of oil reached around USD80 per barrel oil, an increase of 30%, since Jan 18.
• Darmin declined to confirm that the government had already decided to increase the fuel price.
• The Premium price is lower than the market price because, together with Biosolar branded diesel, it is subsidized by state-owned energy holding company Pertamina through public obligation service (PSO) scheme. In the past the subsidy came from the state budget.

External Link: http://www.thejakartapost.com/news/2018/10/12/government-to-meet-on-price-of-subsidized-premium-fuel.html

External Link: http://www.thejakartapost.com/news/2018/10/10/government-abruptly-cancels-plan-to-increase-subsidized-fuel-prices.html

External Link: https://www.pertamina.com/id/news-room/news-release/pertamina-sesuaikan-harga-bbm-non-subsidi-