Pertamina delays new fuel price statement<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
State-owned oil and gas firm Pertamina delayed on Tuesday
\nannouncing the new fuel prices for the month of May as labor
\ngroups are preparing for a massive rally.<\/p>\n
Company spokesman Adiatma Sardjito said that until late in the
\nday the government had not yet given the green light for
\nPertamina to publish the new price list. He could not say why.<\/p>\n
Pertamina was supposed to make the announcement on Tuesday.<\/p>\n
Since Jan. 16, the government has pegged most fuel products
\nexcept kerosene for households and small industry, to prices in
\nneighboring Singapore. Starting from March the prices are set
\nmonthly based on the price of the Mid Oil Platts Singapore
\n(MOPS), although the government has also set a floor price and
\nceiling price to anticipate sharp fluctuation in the
\ninternational price. The floor price and ceiling price for
\npremium gasoline, for instance, is set at Rp 1,450 and Rp 1,750.<\/p>\n
As international oil prices have been hovering at an average
\nof US$26 per barrel during the past couple of weeks, experts are
\npredicting that fuel prices for March would increase.<\/p>\n
Indeed, Minister of Energy and Mineral Resources Purnomo
\nYusgiantoro said on Monday that the price of premium gasoline for
\nMay could increase to Rp 1,750 per liter, which is the ceiling
\nlimit, from Rp 1,600.<\/p>\n
Raising fuel prices has been a politically sensitive issue in
\nthe country where tens of millions of poor people have suffered
\nfrom three years of economic hardship.<\/p>\n
With dozens of labor groups planning to stage a rally on
\nWednesday to commemorate labor day, the government seems to have
\nno choice but to delay the announcement of the new fuel prices.<\/p>\n
Adiatma said that until the new price list is published, the
\ncurrent list is still valid.<\/p>\n
Higher fuel prices will also trigger inflation. With monthly
\ninflation already in the double-digit level during the past three
\nmonths, Coordinating Minister for the Economy, Dorodjatun
\nKuntjoro-Jakti admitted last week that the inflation for this
\nfull year could reach 12 percent, compared to the government's
\noriginal target of 9 percent.<\/p>\n
The government has said that pegging fuel products at home to
\nthe international price is crucial to help reduce the burden of
\nthe state budget and curb fuel smuggling out of the country.<\/p>\n
Meanwhile, a source said that the government was also
\nconsidering to revise the current mechanism in setting domestic
\nfuel prices.<\/p>",
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