Pertamina prefers buying refined fuel than crude to reduce costs

Stated-owned oil and gas company Pertamina has preferred importing refined fuel products than crude oil lately because the rise in crude oil prices has caused processing activities at its own refineries become more expensive, the company's executive has said.

Pertamina? Processing Director Suroso Atmomartoyo, said in Jakarta Friday that the company's crude oil imports for April had been reduced by 1.5 million barrels due to the soaring crude oil prices in the world market.

Pertamina, which needs at least 9 million barrels a month to meet the country's fuel demand, had instead raised its refined fuel imports to 11.6 million barrels from 11 million barrels previously.

"Buying crude oil for processing is more expensive now. We now buy crude at about US$100 per barrel," he said. With the increase in the fuel imports, Pertamina's refineries have operated below their normal capacity. The Balikpapan refinery, for example, only operates at 96 percent of its capacity, while the Cilacap refinery at between 90 percent and 96 percent. (*)