Fri, 29 Sep 2000

Pertamina says fuel stocks enough to anticipate surge

JAKARTA (JP): State oil and gas company Pertamina said on Thursday it had stockpiled enough fuel to anticipate a sudden surge in demand ahead of a fuel price increase on Sunday.

"Our fuel stock is enough for 23 days of national consumption. We don't expect the public to panic and rush to buy fuel prior to the implementation of the fuel price increase. Anyway, we are ready to handle any possible rush on fuel," Pertamina spokesman Ramli Djaafar told The Jakarta Post.

According to Ramli, Pertamina employees across the country were prepared to monitor fuel demand around the clock, and take quick action to increase supplies in cases of sudden surges in demand.

"Thus far, as far as fuel supply is concerned, the situation is calm across the country. We haven't seen any sudden surges in fuel demand," Ramli said.

Ramli also denied reports that fishing companies in Maluku and Irian Jaya were suffering from a fuel crisis, insisting that fuel supplies in both provinces were sufficient.

The Association of Indonesian Fishing Companies (Gappindo) said earlier a number of fishing firms were unable to operate at full capacity over the past two months due to a shortage of fuel.

Gappindo said many owners of fishing boats and fish processing plants in both regions had to line up at Pertamina's fuel depot for hours, and ended up receiving only 30 percent of the fuel they required.

The association warned that numerous fishing companies, which play an important role in the two regions' economies, would go under if the situation was not addressed and the government went ahead with its plan to raise fuel prices on Sunday.

Ramli insisted Pertamina's fuel supplies to both regions were sufficient.

According to Ramli, fuel demand in the two regions had surged to above normal levels over the past two months, which he said was mainly the result of an increase in demand from big shipping companies.

However, he said Pertamina refused to increase supplies to the two regions for fear the additional fuel would be hoarded or smuggled.

"I am not saying the fishing companies want to hoard or smuggle the fuel, but we have records of the normal level of fuel needs for all areas across the country, including Irian Jaya and Maluku, and we supply fuels based on these records.

"Thus, if fuel demand in one area suddenly rises above normal levels, we first carefully study the reasons behind the rise in demand before adding supplies to the area. We don't want the additional fuel to be hoarded or smuggled."

The government plans to raise fuel prices 12 percent on Sunday in a bid to cut fuel subsidies, which was agreed to with the International Monetary Fund (IMF), which is providing the country with bailout loans.

The government initially planned to implement the fuel price increase on April 1, but delayed the plan following a public outcry.

There have been numerous demonstrations against the government's plan to raise fuel prices, but President Abdurrahman Wahid has said the government will not delay the hike any longer.

The price for Premium gasoline will increase to Rp 1,150 (13 US cent) per liter from Rp 1,000 per liter; automotive diesel oil to Rp 600 per liter from Rp 550; kerosene to Rp 350 per liter from Rp 280; and bunker oil to Rp 400 per liter from Rp 350 per liter.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said earlier the 12 percent increase in fuel prices would allow the government to cut fuel subsidies by Rp 800 billion from October to December.

He said the money would be used to finance programs that benefit the poor.

The money will be distributed by the Ministry of Settlement and Regional Infrastructure and the Office of the State Minister of Cooperatives and Small and Medium Enterprises in a number of programs designed to benefit the people, he said.

Fuel price is traditionally a sensitive issue in the country. The government last raised fuel prices in May 1998, which was followed by riots which contributed to the downfall of then president Soeharto. (jsk)