Government unsure of fuel prices adjustment next year<\/p>\n
Leony Aurora and Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
While global oil prices are on the decline, the government
\nremains unsure of whether to readjust fuel prices next year,
\ndepending on whether the declining trend of oil prices is here to
\nstay.<\/p>\n
That would then determine whether the earmarked fuel subsidy
\nfor next year -- set at Rp 54 trillion (US$5.4 billion) -- would
\nbe enough or not, Minister of Energy and Mineral Resources
\nPurnomo Yusgiantoro said on Wednesday.<\/p>\n
\"The government is trying to ensure that the subsidy will be
\nenough for next year. We cannot decide whether to lower fuel
\nprices amid the declining trend in global oil prices,\" said
\nPurnomo at the presidential palace on Wednesday.<\/p>\n
The subsidy is based on an oil price assumption of US$57 a
\nbarrel.<\/p>\n
After hovering above $60 a barrel for months, global oil
\nprices are now below $60.<\/p>\n
On Wednesday, New York's main contract, light sweet crude for
\ndelivery in December, eased 8 U.S. cents to $59.63 per barrel in
\nelectronic dealing, as reported by AFP. In London, the price of
\nBrent North Sea crude for December delivery fell 29 U.S. cents to
\n$57.52 per barrel.<\/p>\n
This year, subsidizing fuel is estimated to cost the
\ngovernment over $7 billion, with local demand estimated at more
\nthan 65 million kiloliters.<\/p>\n
The government raised domestic fuel prices by an average of
\n126.6 percent in October in an attempt to save the state budget
\nfrom the ballooning fuel subsidy.<\/p>\n
Meanwhile, state oil and gas firm PT Pertamina says that the
\naverage daily consumption in the first eight days in November
\ndropped significantly as factories stopped production nearing the
\nIdul Fitri holiday, which fell on Nov. 3 and Nov. 4 this year,
\nand fewer people traveled to their hometowns due to the recent
\nfuel price hike.<\/p>\n
Pertamina's head of fuel division Achmad Faisal said that the
\naverage daily offtake of premium gasoline this month thus far
\nstood at 49,200 kiloliters (kl), kerosene 13,352 kl and diesel
\nfuel 63,192 kl, making the total 125,744 kl.<\/p>\n
\"The average daily consumption in October was 157,346 kl,
\nless than September's 174,622 kl,\" said Faisal.<\/p>\n
\"We can't tell yet whether this declining trend will
\ncontinue,\" he said. \"Hopefully it will.\"<\/p>\n
Due to lower consumption and as the country's refineries
\nreturn to full swing after two of them were shut down for
\nmaintenance last month, Pertamina will import less fuel than
\nexpected this month.<\/p>\n
In November, the state firm will import 11.6 million barrels
\nof fuel products, comprising 3.2 million barrels of premium
\ngasoline, 1.2 million barrels of kerosene and 7.2 million barrels
\nof diesel fuel.<\/p>\n
Pertamina previously estimated that it would need to import 14
\nmillion barrels of fuel this month, down from 17 million barrels
\nin October.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/government-unsure-of-fuel-prices-adjustment-next-year-1447893297",
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