Pertamina raises supplies but long queues remain
Pertamina raises supplies but long queues remain
The Jakarta Post, Jakarta
Even though state oil and gas firm PT Pertamina has increased
fuel supply for the domestic market -- from its quota of 184,000
kiloliters (kl) per day to 194,000 kl -- long queues at gasoline
stations and kerosene depots can still be seen in some parts of
the country.
Pertamina's trading and marketing director Ari Soemarno said
on Thursday during a hearing with the House of Representatives
Commission VII on energy and mineral resources that the firm
could not increase the supply to meet domestic market demand, as
it would surpass the quota of 59.6 million kl this year.
"From January to June, we have supplied 184,000 kl per day but
the demand keeps increasing," he said. "So long queues (at gas
stations) are not caused by a fuel supply shortage."
In Semarang in Central Java, Makassar in South Sulawesi and
East Nusa Tenggara, people had to queue to buy kerosene, mostly
used for cooking. Pertamina also found indications that people
buy the subsidized kerosene and diesel fuel from gasoline
stations to be sold to industries, which pay the market prices
for the products.
"Pertamina has been overwhelmed in monitoring such practices,"
Ari said.
To overcome this, President Susilo Bambang Yudhoyono had
instructed the firm to keep plowing more fuel into the market and
tighten distribution supervision.
With global oil prices hovering at around US$65 per barrel,
the government will have to spend over $10 billion for the fuel
subsidy this year to keep the price of gasoline, diesel fuel and
kerosene well below international market prices.
Apart from reselling practices, Pertamina also has to deal
with the smuggling of subsidized fuel products to neighboring
countries due to the wide price disparity.
Pertamina had recently fired dozens of officials for their
alleged involvement in crude oil theft from the Lawe Lawe oil
storage in East Kalimantan. However, many regard the dismissed
officials as the company's "small fish".
Susilo had said earlier that the government would increase
fuel prices in early October.
State Minister of National Development Planning Sri Mulyani
Indrawati said on Wednesday that the government may increase fuel
prices by at least 50 percent next month to cut the state budget
deficit.
Bloomberg quoted Mulyani who said that after the probable 50
percent hike, prices would be raised gradually to cover costs
within 36 months.
The government has argued that the fuel subsidy cut would be
used directly and indirectly to assist low-income families. The
government will disburse Rp 100,000 for each poor family eligible
for the fund as registered by the Central Statistics Agency
(BPS).
A total of Rp 4.8 trillion ($480 million) have been set aside
for that purpose this year.