LPG price raised, others stable
The Jakarta Post, Jakarta
State-owned oil and gas company Pertamina has raised the price of liquefied petroleum gas (LPG), while leaving the prices of other fuels unchanged.
Starting Friday, Pertamina will sell LPG for Rp 2,850 (33 US cents) per kilogram, up Rp 150, or 5.5 percent, from the previous price, in areas other than Batam.
For Batam, Pertamina will sell the product for Rp 3,500 per kilogram, up Rp 800, or 29.6 percent, from the previous price, Pertamina's general manager for LPG and special products, Iqbal Hasan, said in a press conference on Thursday.
Pertamina deliberately sets higher prices for Batam to make them similar to the prices in Singapore, thus discouraging the smuggling of fuel to the city state.
LPG is widely used in urban households for cooking as an alternative to kerosene. The fuel is usually sold in 12-kilogram tanks, which based on the new pricing scheme will cost Rp 34,200, compared to Rp 32,400 previously.
Iqbal said Pertamina was forced to raise the price in a bid to cut its losses, saying that the firm had been losing money in the LPG business for the past several years.
Last year, the firm booked a loss of Rp 565 billion from LPG trading, and in the first semester of the year the losses reached Rp 102 billion.
"As the result of the new pricing scheme, we hope to reach a breakeven point in LPG trading in the second semester of the year," he said.
Citing the same reason, Pertamina raised LPG prices twice last year, in July and December, a move which drew public protests.
Iqbal also said that in order to promote the wider use of LPG by the public, Pertamina would cut the price of LPG tanks by 35 percent to Rp 135,000 per unit from Rp 250,000 per unit currently.
On the same occasion, Pertamina also announced that the prices of oil-based fuels would remain unchanged in August.
Thus, the retail price for Premium gasoline stays at Rp 1,810 per liter, while the retail prices of gasoline, automotive diesel oil, industrial diesel and fuel oil remain at Rp 1,800, Rp 1,650, Rp 1,650 and Rp 1,560 per liter respectively.
Pertamina is authorized by the government to raise or cut oil- based fuel prices every month in line with international prices.