Subsidised fuel prices unchanged, public still has choice: Energy Watch

Jakarta (ANTARA) - Research institute Energy Watch stated that Pertamina’s policy of maintaining the price of subsidised fuels, namely Pertalite and Biosolar, means the public still has a choice amidst the adjustment of non-subsidised fuel prices by all operators. However, Executive Director of Energy Watch Olo Berto Siahaan noted that this requires ensuring subsidised fuels such as Pertalite and Biosolar are precisely targeted. “Of course, the existence of subsidised fuels like Pertalite and Solar can be a choice for people who are entitled to receive subsidies,” he said in a statement in Jakarta on Friday. Meanwhile, he added, those who are more affluent need to show empathy by not switching to Pertalite or Solar, as this would cause subsidies to miss their intended targets. He assessed that the price adjustments for Pertamax and Pertamax Green were made with consideration for public conditions, including purchasing power. He deemed the adjustment a reasonable step in line with prevailing market price mechanisms and geopolitical conditions, especially since part of the procurement must be obtained through imports. Berto added that Pertamina had to adopt this policy, otherwise it would severely disrupt the company’s financial condition, particularly as it had held off price increases for a long time, since April 2026. “Moreover, this policy is important to maintain the sustainability of energy supply and the health of the downstream oil and gas industry,” he said. Berto explained that the price adjustment mechanism complies with applicable regulations, namely Ministerial Decree No. 245.K/MG.01/MEM.M/2022, which stipulates that the selling price of non-subsidised fuels should follow developments in global energy market conditions. He added that since most of it is imported, it is heavily influenced by geopolitical conditions, including world oil prices and currency exchange rates, as well as the extra capital or costs required in the energy distribution business process from upstream to downstream. Under such conditions, he said, if Pertamina did not raise the price of Pertamax and Pertamax Green, it would have a negative long-term impact, creating pressure on business sustainability and investment in the energy sector. Berto noted that Indonesia’s fuel prices remain more competitive compared to other countries, such as the Philippines, which sells RON 91 fuel for around Rp24,563 per litre and RON 95 for Rp25,160 per litre. In Singapore, RON 92 fuel is priced at around Rp47,269 per litre and RON 95 at Rp47,815 per litre. Meanwhile, National Energy Council (DEN) member Satya Widya Yudha said the adjustment of Pertamax and Pertamax Green prices is a reasonable corporate move as both are non-subsidised fuels. He added that the government had previously held back price increases for Pertamax and Pertamax Green as non-subsidised fuels. However, this could not be done indefinitely, especially with the weakening currency and persistently high global oil prices. According to Satya, the price adjustment had to be made, otherwise it could potentially burden the fiscal position and state budget (APBN), forcing the government to shoulder an increasingly large budget deficit.