Prices of Pertamina's fuel imports too high

The prices of the fuel purchased by state owned oil and gas company Pertamina for September delivery are believed to be far higher than the prevailing market prices, Bisnis Indonesia reported on Monday.

According to information collected by the newspaper, the prices of about 8.2 million barrels of diesel oil purchased by Pertamina for September delivery from a number of suppliers including Pertamina Energy Trading Ltd. (Petral), Pacific Petroleum Trading (PPT) and Korean Indonesia Petroleum Company (Kipco) were too expensive.

Based on the finding, the newspaper estimated that the per barrel prices of the fuel purchased from these suppliers including transportation cost were about US$3 higher compared to the price issued by Mid Oil Platt's Singapore, plus the average shipping tariff for an 80,000 DWT oil tanker

Pertamina bought the fuel from these suppliers at premium of between US$1.6 and US$1.7 per barrel, while from other suppliers including BP, Kuwait Petroleum Company and Vitol at a premium of between 0.4 and US$0.8 per barrel.

Pertamina's president Widya Purnama and marketing director Ari H. Soemarno were not available for comments. The company's spokesman Harun acknowledged that there was a slight increase in the prices of the fuel for the September delivery. But no details were available. (*)