Subsidized fuel consumption down

Leony Aurora, The Jakarta Post, Jakarta

Two weeks after the government raised fuel prices by 126 percent on average, domestic consumption of oil-based fuels, particularly premium gasoline, continues to decline, according to state oil and gas firm PT Pertamina.

It remains unclear whether the decline is due to the higher prices, less activities during the fasting month, or whether people are still using fuel stockpiled before the price hikes, Pertamina's fuel division director Achmad Faisal said on Tuesday.

"It's too early to say whether the lower consumption levels will continue," said Faisal.

Premium gasoline offtake on Monday stood at 33,700 kiloliters (kl), lower than the daily average offtake of 53,300 kl before the hikes. Overall offtake on Monday -- premium gasoline, kerosene and diesel -- stood at 140,000 kl while last Saturday the figure stood at 170,000 kl, both lower than the allocation of 190,000 kl before Oct. 1.

Amid ballooning fuel subsidy spending resulting from soaring global oil prices, the government almost doubled the price of premium gasoline from Rp 2,400 (24 U.S. cents) per liter to Rp 4,500 two weeks ago. At the same time, diesel jumped from Rp 2,100 to Rp 4,300 per liter, while kerosene almost tripled from Rp 700 a liter to Rp 2,000 a liter.

In the light of the lower demand, Pertamina has rescheduled some of the shipments of imported premium gasoline due in October to next month.

"We have not revised our (full-year) import plans yet as we want to keep the national fuel stock secure," said Faisal.

The national stock stood at the normal level at 22.4 days as of Tuesday. The premium gasoline stock is sufficient to cover demand for 20.5 days, diesel for 19.2 days, and kerosene, used mainly by low-income families to cook, for 27.2 days.

Regarding the liquified petroleum gas (LPG) supply, Pertamina spokesman Mochamad Harun said that one vessel carrying 1,800 metric tons of imported LPG would arrive tonight.

"The other two cargoes (of similar capacity) will dock next week and the week after to secure the supply for Lebaran," he said, referring to the Islamic holiday that falls on Nov. 3 and Nov. 4 this year.

LPG has been scarce for the past few weeks following disruption of production at the plants in Cilacap and Balikpapan, sending prices soaring from the usual Rp 51,000 per 12-kilogram bottle of LPG to more than Rp 70,000.