Govt still studying political, social, security impacts of increasing fuel prices
Thursday, August 31 2000 - 04:30 AM WIB
The government is still studying political, social and security impacts of increasing fuel prices, and therefore looking into all available options, according to Minister of Energy and Mineral Resources Purnomo Yusgiantoro.
Purnomo said in Jakarta Wednesday evening that the options for the government was to increase the fuel prices or even to cut it down further.
"We don't know yet about the fuel price increase, as it is not decided yet. Now we are still studying carefully a number of available options," Purnomo said.
"Fuel prices could increase and also decrease. They can increase by a quarter or decrease also by a quarter. Currently that's the options," he added.
He added that the decision to increase or decrease fuel prices lied not only with his office, but with the coordinating minister of the economy and the Cabinet as a whole. It means it would be decided by a Cabinet meeting.
The government had initially planned to increase fuel prices in April, but because of public outcry, it decided to postpone the increases until October.
Nevertheless, Purnomo said that he agreed with assumptions that increasing fuel prices would bring about social and security impacts to the society.
On the other hand, Purnomo explained that the current big gap between domestic and foreign fuel prices opens possibility of fuel smuggling. Premium, for instance, sells in the domestic market at Rp 1,000 per liter, while in Singapore, it sells at around Rp 2,000.
"We must reduce this price disparity," he added.
Purnomo noted that investigations by a joint team to fight against fuel smuggling, led by Slamet Singgih revealed that a number of big traders, called "Cukong" had continuously smuggled fuels abroad. They inflicted losses of around Rp 1 trillion to the government.
The team had nabbed a number of names for smuggling fuels. They include Yudhi Foo, Iwan, Bambang Susanto and rectors of PT Mulia, and PT Yamato Yama Persada. The police were currently processing the charges for those people. (*)