Minister says fuel price, power tariff won?t be increased despite oil hike
Saturday, March 25 2017 - 05:24 AM WIB
Petromindo|Boim
Minister of Energy and Mineral Resources Ignasius Jonan assured that the price of fuel products regulated by the government including Premium brand gasoline, diesel, and kerosene won?t be increased in the period of April and June despite the current rising oil price trend.
He also said that electricity tariff in the April-June period will not be increased.
?Fuel price controlled by the government such as RON 88 Premium (gasoline), biodiesel and kerosene will not increase from April until June,? Jonan told reporters on Friday.
The government is supposed to review the price of the regulated fuel products at the end of March by taking into account among others international oil price.
Jonan argued that there?s no need to increase the fuel price despite the rising trend in crude oil price as state-owned oil and gas firm PT Pertamina still have reserves funds from the windfall profit it enjoyed last year when crude price tumbled to around US$40 per barrel and the government did not cut down the retail price of the fuel products.
In addition, he reiterated that Pertamina should continue to take efficiency measures.
Pertamina Marketing Director Muchamad Iskandar acknowledged that the company had accumulated windfall profit of up to Rp 2 trillion from selling the three regulated fuel products last year due. But he said that the profit had depleted as per January of this year as the company had been selling the fuel products at a loss following the rise in oil price since October of last year.
Elsewhere, Jonan said that the decision not to increase electricity tariff in the April-June period in line with the direction made by President Joko Widodo to help ensure people?s purchasing power.
He added that state-owned electricity firm PT PLN must also continue to take efficiency measures.
The government is also supposed to review the electricity tariff taking into account factors such as Indonesia Crude Price, inflation rate and exchange rate of the rupiah against the US dollar. (*)