Pertamina told to stop supply of RON 88 gasoline

The Oil and Gas Reform Team on Sunday issued a six-point recommendation regarding subsidized fuel products including for state-owned oil and gas firm PT Pertamina to end the supply of premium gasoline with research octane number (RON) 88, replacing it instead with RON 92 gasoline.

Switching to RON 92 fuel product would help improve transparency and end the alleged cartel practices in the supply of the RON 88 gasoline as the number of global suppliers of the latter product is very limited, and that the importer of the product for the domestic market, albeit changing every year, are actually controlled by the same owner, Head of the reform team Faisal Basri was quoted as saying by Kontan daily Monday.

The reform team hopes that Pertamina could implement the recommendation in five-month time. Given that only the Balongan refinery can produced the specific RON 92 fuel product, Pertamina will have to import more of the product until its other refineries have been upgraded to be able to produced RON 92. It also recommends a fixed subsidy of RON 92 fuel at Rp 500 per liter.

The reform team also recommends for Pertamina to stop the import of Gasoil with 0.35 percent sulfur, switching instead to the import of Gasoil with 0.25 percent sulfur. The upgrading of domestic refineries is also aimed for the facility to be able to produce products equal to the quality of Gasoil with 0.25 percent sulfur, the team said in a statement.

Elsewhere, the reform team also recommended that the refinery in Tuban, East Java, owned by PT Trans Pacific Petrochemical Indotama to be fully operated by Pertamina to help achieve the aforementioned recommendations. (*)