Govt proposes an increase in subsidized fuel quota

The government has proposed a increase in the subsidized fuel quota in the 2011 state budget to 40.49 million kiloliters from 38.59 kiloliters to meet the surge in the demand.

Speaking during a hearing with the Commission VII of the House of Representatives (DPR) on the revision of the 2011 state budget on Wednesday, the Energy and Mineral Resources Ministry?s director general of oil and gas Evita H. Legowo also proposed a change in the oil reference price Indonesian Crude Price (ICP) and the oil lifting (net production).

The 40.49 million kiloliters new fuel quota proposed by the government includes 24.54 million kiloliters of Premium gasoline, 1.80 million kiloliters of kerosene, 14.15 million kiloliters of diesel oil. The subsidized LPG quota is maintained at 3.52 million tonnes, Evita said.

Evita said that the government proposed an increase in ICP price to US$95 per barrel from $80 per barrel in line with the upward trend in crude oil price in the world market. She said that the realized oil price rose sharply to US$107 per barrel during the period between January and May 2011. But especially for June, the realized ICP averaged only $95.91 per barrel.

Meanwhile on oil lifting, Evita proposed a cut in the oil lifting to 945,000 barrels per day from 970,000 barrels per day due to the decline in the country?s oil production. She said that the realized oil lifting as of May reached only 906,000 barrels per day, lower than the initial target of 970,000 barrels per day. (godang)