Team to tackle kerosene scams

Muninggar Sri Saraswati, The Jakarta Post/Jakarta

Blaming those ubiquitous "certain parties" for causing the kerosene scarcity through their fuel-smuggling deeds across Indonesia, the government said on Friday it would establish a joint team to fight the illegal practices that were undermining its fuel policy.

Kerosone shortages have continued in many areas around the country following the government's decision to raise the fuel prices by an average of 29 percent on March 1, but the with the key exception of the household kerosene, which remains subsidized at a price of Rp 700 per liter. It was meant to alleviate the burden of low-income families -- the largest group of users.

Many have blamed the problem on the ever-present "certain parties", apparently some from within and some from outside of state-owned oil firm Pertamina, who also mixed the cheaper kerosene with gasoline. They sell the mixed gasoline at the normal prices and increase their profit margin.

The plan to set up the team to look into the corruption was decided in a meeting led by President Susilo Bambang Yudhoyono to discuss the issue on Friday.

Also attending were National Police chief Gen. Da'i Bachtiar, Indonesian Military commander Gen. Endriartono Sutarto, State Intelligence Agency head Maj. Gen. Syamsyir Siregar, Coordinating Minister for Political, Legal and Security Affairs Widodo Adi Sucipto and Minister of Energy and Mineral Resources Purnomo Yusgiantoro.

Endriartono said the President ordered Widodo to lead the team, consisting of police, military, Pertamina and BIN officers.

"The President does not want negative excesses from the fuel price hike policy, such as kerosene scarcity, smuggling and fuel- mixing, to cause more burdens on the people," Endriartono announced after the meeting.

The team will mainly be tasked with preventing possible manipulation of kerosene supplies for households, reducing pengoplosan, the mixing of kerosene with other fuel, and minimizing fuel smuggling.

Da'i said the police would take the "persuasive approach" to deal with the manipulation that led to the kerosene scarcity.

"The kerosene supplies from Pertamina are actually sufficient. It has also delivered additional supplies, but the scarcity continues. We think there are people buying kerosene in a significant amount when the supply is delivered from one station to another. We'll prevent it through the persuasive approach," he said.

The government maintained the subsidized price of kerosene for households at Rp 700 per liter, but raised to Rp 2,200, the price for industry.

"Why does the kerosene scarcity continue? We smell foul play by 'certain groups' behind it," Da'i elucidated.

Cabinet Secretary Sudi Silalahi, who also attended the meeting, did not identify the "certain groups", but vowed that the authorities would deal with them, so "the people would know the players".

Purnomo said kerosene scarcity has been reported mostly in Jakarta and Lampung.

"It happens because of the disparity between prices (of kerosene for households and that for industry). This causes smuggling, misuse and pengoplosan," he said.

Purnomo said Pertamina could not make additional kerosene supplies because it would exceed the limits of subsidies stipulated in the state budget.

He urged the authorities to enforce the law to stop or reduce the misuse of kerosene, which he said causes some Rp 2 trillion in state losses a year.