Maintain Economic Stability, Pertalite Prices Remains
Jakarta, March 9, 2022 - Although world crude oil continues to soar due to the Russia-Ukraine conflict, the Government and PT Pertamina (Persero) ensure that the Pertalite type of fuel oil (BBM) does not increase. It is done to maintain the purchasing power of the people who currently use Pertalite.
Furthermore, according to the Director-General of Budget at the Ministry of Finance, Isa Rachmatarwata, the global risk is escalating due to the Russia-Ukraine conflict, ultimately affecting the high price increases for energy commodities. It includes crude oil, coal, to gas.
"The increase in world crude oil prices will certainly have an impact on the state budget," said Isa in Jakarta today.
Overall, he explained that the increase in commodity prices, including the Indonesian Crude Price (ICP), brought a positive impact on state revenues, especially PNBP. However, the increase in commodity prices will impact state spending. "Especially the energy subsidy, which makes ICP one of the main parameters in its calculation," she explained.
The government, continued Isa, will continue to monitor the movement of world oil prices and measure its impact on the state budget. The government will take the necessary policies by looking at the potential for state revenue, the burden on state spending, and the consequences of budget financing. Indeed, she added, "By taking into account the socio-economic conditions of people who are currently recovering from the impact of the Covid-19 Pandemic."
Isa also emphasized that the government will continue to monitor economic developments, including the latest commodity price volatility, to anticipate policies.
"The government will ensure that the policy response prioritizes the stability of the national economy and maintains the supply of goods for the community's basic needs, both food, energy, and maintaining fiscal sustainability that supports the business world," she explained.
Supporting the efforts to stabilize the national economy, Vice President of Corporate Communication of PT Pertamina (Persero), Fajriyah Usman, explained that Pertamina, as an SOE that plays a role in managing national energy, is also very considerate of the socio-economic conditions of the community in determining the price of fuel products.
"We fully support the government's policy in national economic recovery. Therefore, even though the world oil price has penetrated US$ 130 per barrel, Pertamina continues to coordinate with the government to decide that the price of Pertalite will remain at the selling price of Rp 7,650 per liter," Fajriyah said in Jakarta.
According to her, the price has not changed in the last three years, and currently, the portion of Pertalite consumption is the largest, or around 50% of the total national fuel consumption. Therefore, the government continues to discuss the Pertalite compensation scenario so that Pertalite price stabilization can be maintained.
To reduce the pressure of the spike in world crude oil prices on the increase in the cost of fuel supply, Fajriyah continued, Pertamina continues to carry out various efficiencies in all lines, including reducing the cost of domestic fuel production. These include maximizing the use of domestic crude oil and optimizing the use of natural gas to save energy costs. In parallel, refinery production was also carried out for high-value products.
Moreover, product price adjustments are also carried out selectively, only for certain non-subsidized fuels such as the Pertamax Series and Dex Series, whose consumption portion is only around 15% of the total national fuel consumption. This type of fuel is also mostly consumed by well-off consumers, such as private vehicle owners of the upper-middle class. In the future, the price of this fuel product will continue to be adjusted regularly to follow the market price following the ESDM Ministerial Regulation No. 62 of 2017.
“Pertamina is meticulous in setting prices. However, we believe that this consumer segment has experienced the benefits of quality fuel that is more efficient and better for vehicle engine maintenance. Thus, they can receive prices that have remained very competitive compared to other similar products," he said.**