Pertamina vows to secure fuel supply
The Jakarta Post, Jakarta
In a move to help safeguard fuel prices ahead of the Muslim's fasting month of Ramadhan -- during which fuel consumption traditionally increases -- state oil and gas firm PT Pertamina pledges to boost supply and distribution of fuel.
Tjandra Putra, the manager of Pertamina's Marketing Unit III (UPMS III) -- which is in charge of securing fuel supply and distribution in greater Jakarta, West Java and Banten, ensured fuel availability in the market despite the expected raise in demand.
"Usually during the fasting month (which will start on Friday), there is a 10 percent to 15 percent increase in fuel demand from normal consumption. But, we're ready. We'll increase fuel supply and ensure smooth distribution," Tjandra was quoted by Detik as saying on Saturday.
Ensuring fuel supply at home during Ramadhan will be crucial to avoid disruption in the distribution of goods, as well as transportation, and thus help curb inflationary pressure, which traditionally soars during the festivity particularly amid the current surge in international oil prices.
A net-oil importer, Indonesia purchases oil-based fuel products at high international market prices, and has to then sell it at home at subsidized prices due to the existing fuel subsidy policy -- a policy which has renewed criticism, as a large portion of the subsidized fuels is enjoyed by car owners, not poor-income people.
Various studies show that, of the subsidized fuel commodities, only kerosene really serves the interest of the poor Indonesians.
For 2004 alone, the government has to allocate Rp 59.2 trillion for fuel subsidy -- around 2.5 times of this year's state budget deficit of Rp 24.4 trillion.
But, reducing subsidy, which would consequently push up fuel prices at home, has proven to be a sensitive issue and seen as unpopular policy.
President-elect Susilo Bambang Yudhoyono has said his government would not be afraid of taking unpopular measures, and a change in the existing subsidy policy to a more targeted and pro-poor scheme would be inevitable in times to come.
However, in view of those festivities, in which people will spend more on consumption goods -- thus have less left in their pockets. There are suggestions that any change of the existing subsidy policy should not be made in the near future in order not to further hurt the people's purchasing power.
Minister of Energy and Mineral Resources Purnomo Yusgiantoro was among who raised that suggestion, saying that as such would be more realistic if conducted sometimes next year.
"The government has to be realistic, for the fuel prices to be increased (as a consequence of subsidy cut or removal), it has to pass through a cabinet meeting (which has yet to be formed) and consent from the House of Representatives.
"While at the same time, we're approaching the fasting month and Idul Fitri. So, I think it would be difficult to do that this year," Purnomo said in Nusa Dua, Bali on Friday.