Why is Pertalite Being Considered for Removal?

The discourse on removing Pertalite has resurfaced amid soaring global oil prices and the swelling burden of energy subsidies on the state budget (APBN). The government is reportedly examining a new scheme to redirect subsidies from RON 90 fuel (Pertalite) to higher-quality fuels such as Pertamax. “There was a proposal recently (to remove Pertalite), oil prices are high and the subsidy burden is increasing. But for now, no decision has been made; we are still observing the situation,” said a source familiar with the matter. Pertalite has long been the public’s preferred fuel because its price is far cheaper than non-subsidised fuel. However, several international institutions and economists assess that the current subsidy scheme is poorly targeted and burdens state finances. The World Bank, in its June 2026 Indonesia Economic Prospects report, stated that the surge in global oil prices has exposed fundamental weaknesses in Indonesia’s fuel subsidy system. According to the World Bank, fuel subsidies are disproportionately enjoyed by wealthier groups. The figures are striking: 20% of the richest households enjoy about 50% of total fuel subsidies. Energy subsidy spending reaches 1.6% of Gross Domestic Product (GDP). The rise in global oil prices is making the APBN burden increasingly heavy. In other words, the state spends large sums on subsidies, but the benefits are not fully enjoyed by the groups most in need. The World Bank has proposed three reform steps. First, gradually increase subsidised fuel prices to approach market prices. Second, provide direct cash assistance to the poorest 40% of households to compensate for the impact of fuel price increases. Third, use the subsidy savings to strengthen social protection programmes, public investment, and job creation. According to World Bank simulations, the reform could potentially yield fiscal savings of 1.3% of GDP within two years, rising to 2.1% of GDP when the policy is fully implemented. Pertalite will not be removed immediately. The government is still maintaining the price of Pertalite at Rp10,000 per litre and subsidised diesel at Rp6,800 per litre. PT Pertamina Patra Niaga has also confirmed that Pertalite stocks are secure and distribution to petrol stations is running normally across Indonesia. The company even stated it has prepared a distribution strengthening scheme should a surge in demand occur due to people switching from Pertamax to Pertalite. Several signals are fuelling public speculation. First, the Pertalite quota is continuously controlled by the government to manage the subsidy burden. Second, an increasing number of Pertamina Signature petrol stations only sell non-subsidised fuels such as Pertamax, Pertamax Turbo, Dexlite, and Pertamina Dex. Third, the government and several international institutions are increasingly actively encouraging the use of higher-quality fuels for energy efficiency and emission reduction. These conditions create a perception that Pertalite is slowly being directed towards a transition phase. Although the price of Pertamax jumped from Rp12,300 to Rp16,250 per litre in June 2026, the government considers this price still cheaper than similar fuels in other Southeast Asian countries. Government data shows that the price of RON 92-95 fuel in the Philippines, Thailand, Laos, Myanmar, and Singapore is far above the price of Pertamax in Indonesia. The government also emphasised that the increase in Pertamax prices follows the surge in global oil prices that has occurred since March 2026. The removal of Pertalite is not yet official government policy. However, fiscal pressure from energy subsidies, reform recommendations from the World Bank, and the push for higher-quality fuel usage are making the future of Pertalite an increasing topic of discussion. The big question is no longer whether fuel subsidies will be reformed, but how the government ensures low-income communities remain protected when that change is finally implemented.