Wed, 15 Jan 2003

`Kerosene operation should continue'

A'an Suryana and Novan Iman Santosa, The Jakarta Post, Jakarta

Poor residents are asking Pertamina and the city administration to continue and expand its market operation to provide them with price-controlled kerosene.

Residents of Rorotan subdistrict in Cilincing district, North Jakarta, said on Tuesday the price of kerosene had risen well above a city-set dealer price cap on the commodity.

The government increased the price of kerosene from Rp 600 to Rp 700 per liter this year, while the city set a price cap of Rp 885 (9 US cents) per liter at the depot level -- or Rp 5 lower than the national depot-level price cap.

However, the actual retail price is much higher.

"Before the price hike I bought kerosene from nearby shops for Rp 1,000 per liter. But it soared to Rp 1,200 after the price hike," a housewife, Ani, said.

She said she was grateful for the market operation, which allowed residents to buy kerosene for Rp 885 per liter.

"It is just too bad that they limited the amount of kerosene we could buy, because I really need more kerosene," she said.

During the market operation, organized by the city administration in cooperation with state-owned oil and gas company Pertamina and the Jakarta chapter of fuel retailer association Hiswana Migas, people only were allowed to buy 10 liters of kerosene to ensure there were sufficient supplies for everyone.

"A liter of kerosene is just enough for one day of cooking and light," said one resident, who like many poor people uses kerosene stoves and kerosene lamps.

Of 12,000 families, or about 26,000 people, in Rorotan subdistrict, some 1,600 families are officially classified as poor.

Another resident, Diah, said she usually paid Rp 1,200 per liter for her kerosene, adding that not only was it expensive but it was also hard to find.

The market operation was aimed at bringing down kerosene prices, which went up following simultaneous increases in fuel prices and electricity and telephone rates.

Baihaki Hakim, president director of Pertamina, said the company intervened through the market operation in order to bring kerosene prices back to normal.

"If we find parties are trying to increase the price of kerosene, we will carry out a market operation and sell the kerosene in line with the initial price, which will deter speculators from unethically raising the price of kerosene," said Baihaki during a visit to the market operation in Rorotan.

He said Pertamina had more than enough kerosene stocks to conduct market operations for one month. However, he did not go into detail about how many liters of kerosene Pertamina had at its disposal.

He also did not say when another market operation might take place in Rorotan or whether it would be possible for residents to buy more than 10 liters per family.

The assistant chief of Cilincing district, Toni Sukanda, hoped Pertamina would conduct market operations more frequently.

"In fact, we would expect Pertamina to provide kerosene regularly, let's say twice a week," he said.

Baihaki said market operations would take place as needed to keep prices down. "But we do not want to disrupt the business of kerosene agents and depots by organizing market operations too often."

Pertamina's Domestic Marketing Unit III, which oversees Jakarta, Banten and West Java, allocated 610 kiloliters of kerosene for the market operation, which started on Jan. 4.

Jakarta received 215 kiloliters of the kerosene, while in West Java Pertamina provided 175 kiloliters of kerosene in Bandung, 60 kiloliters in Bekasi, 50 kiloliters in Subang and 45 kiloliters in Bogor.

In Banten, 40 kiloliters were provided in Tangerang and another 25 kiloliters in Serang.