"Cutting fuel supplies to industrial users are illegal"

State owned oil and gas company Pertamina has been widely criticized for its recent decision to cut the supply of fuel to industrial users. "The decision is illegal," said the secretary general of Indonesian synthetic fiber producers, Asima N. Sitorus.

He said that Pertamina?s measures to cut the fuel supply had caused uncertainty in the operation of synthetic fiber manufacturing companies. Pertamina said that the measure was part of the state oil and gas company?s plan to reduce the oil subsidy.

But Asima said that it was illegal because based on the presidential decree issued in January 16, the cut in the oil subsidy was made by adjusting fuel prices to industrial users at 75 percent of the international price, from 50 percent previously, not by cutting the fuel supply.

According to him, the fuel supply to the synthetic fiber industries were cut by between 10 and 15 percent during the period of September to November, last year.

"Pertamina would even further cut the fuel supply by 25 percent I March this year," he said, adding that the rumor on the further cut of the oil supply had raised concerns among the synthetic fiber producers.(*)