Govt moves to curb kerosene shortage

Govt moves to curb kerosene shortage

The Jakarta Post, Jakarta

State oil and gas company PT Pertamina will revoke the license
of any kerosene retailer caught selling subsidized kerosene for
households to manufacturers.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro
said the harsh action had been introduced to tackle kerosene
shortages ahead of the presidential election in July.

"We don't want the kerosene shortage to be politicized during
the presidential election," Purnomo announced after a meeting
with oil-based fuel distributors on Wednesday.

"From now on, there will be no warnings. If they (retailers)
are caught selling subsidized kerosene, their licenses will be
revoked immediately," Purnomo said.

Pertamina is tasked with distributing subsidized kerosene to
households via appointed retailers.

Purnomo also said that any Pertamina official involved in
abusing the subsidized kerosene policy would face legal action.

He said that kerosene shortages had been faced by households
in some parts of the country, including Jakarta and surrounding
areas, because subsidized kerosene had been sold to businesses,
particularly food and beverages producers.

He said that the 12 million kiloliters of kerosene supplied by
the government for households this year (kerosene is mainly used
by low-income households) was more than enough.

In a bid to help curb shortages, Pertamina has introduced a
color-coding program to differentiate between subsidized kerosene
for households (tinted green) from kerosene for business.

Some retailers had been selling subsidized kerosene to
businesses to gain greater profit from the price disparity.

The price for subsidized kerosene for low-income households is
Rp 700 per liter while unsubsidized kerosene for business retails
at Rp 1,800 to Rp 2,200.