Demand for Subsidized Diesel increases, Pertamina Ensures Sufficient Supply and Distribution
March 30, 2022 – PT Pertamina (Persero) continues to strive for a smooth and on-target subsidized diesel fuel (bio solar) distribution to the community amid the increasing demand. Pertamina also ensures that the current stock of biodiesel is sufficient. Pertamina has even added supply at petrol stations even though it has exceeded the quota set for smooth distribution to the public.
President Director of Pertamina, Nicke Widyawati, said that until February 2022, Pertamina had fulfilled the distribution of Subsidized Solar up to around a 10% increase. Pertamina and the Government have agreed to conduct quota distribution relaxation, especially for areas that are already over-quota, so that normalization efforts are carried out by increasing subsidized Solar supply according to demand in areas experiencing queues.
Pertamina confirms that the national stock of diesel fuel is sufficient. Currently, the national supply for diesel is more than 1.9 million kiloliters per day or covers the needs of 23 days. This figure is being maintained and increased every day due to Pertamina's well-functioning business operations, which start with crude oil production upstream, fuel processing at Pertamina's refineries, and assuring smooth and secure distribution across the country.
Pertamina’s distribution of fuel products is carried out by land, sea, and air. 95 vessels operated by Pertamina through Pertamina International Shipping are dedicated to distribute Pertamina's products throughout Indonesia. Pertamina through Pertamina Patra Niaga also deployed more than 4,000 trucks transporting fuel to remote parts of the country.
In addition, Nicke continued that other efforts made by Pertamina are coordinating with the apparatus to secure the subsidized diesel distribution and take action against the subsidized diesel misuse.
"We have worked together to coordinate with the Indonesian National Police Security Intelligence in all distribution areas or distribution of Pertamina," said Nicke.
Nicke added that Pertamina is also coordinating and conveying information to local governments regarding the limitations of the subsidized Solar quota establishment and regulatory support to regulate the Subsidized Solar distribution, as well as proposals for additional quotas to BPH Migas. "We also ensure the availability of Non-subsidized Solar and encourage consumers to buy Non-subsidized Solar," said Nicke.
Currently, subsidized diesel consumption reaches 93% of Pertamina's diesel products' total sales. T remaining 7% is the non-subsidized Solar consumption which has higher quality, such as Dexlite and Pertamina Dex.
Nicke said Pertamina’s effort needed to be supported by various parties to avoid subsidized Solar shortage within the quota that had been determined by the government. It included the distribution of Solar subsidies on target, more detailed provisions regarding eligible consumer segments are needed, considering that the subsidized diesel retail quota in 2022 set to be distributed by Pertamina is only 14.05 million kiloliters or a decrease of more than 5 percent compared to 2021 quota which is 14.85 million kiloliters.
Furthermore, Nicke stated that the subsidized diesel basic price formula, the number of fixed subsidies, and the subsidized diesel quota must be evaluated in 2022. It must be in line with real demand and based on economic growth and current consumption conditions. In addition, there is a need for tariffs standardization for transporting goods to the industry. Therefore, there will be no tariff war, which will result in truck entrepreneurs buying subsidized diesel.
"There need to be stricter provisions so that industrial transportation uses non-subsidized diesel. The regional government recommends to regional entrepreneurs that in the procurement of industrial transportation it is mandatory to use non-subsidized diesel," said Nicke.**