Subsidized-fuel consumption may hit 43.5m KL

Out of gas: In this March 29, 2012, file photo, a sign reading “gasoline empty” is placed in one of the gas stations in Jakarta. Employees at this Pertamina gas station said their supply of the subsidized fuel had been disrupted for several days. (Antara/Widodo S. Jusuf)

Following the government back-down on a proposal to ban certain cars from using subsidized fuels, the Energy and Mineral Resources Ministry predicts consumption of that gasoline may reach 43.5 million kiloliters (KL) this year.

The ministry’s director general for oil and gas, Evita Herawati Legowo, said that without government action, subsidized-fuel consumption could be 47 million KL. If the government implemented the 2012 presidential regulation on the price of subsidized fuels and consumers who can access the fuels, that estimate could be cut to 44 million KL.

“To forbid government cars from buying subsidized fuels… consumption can be pressed to 43.5 million KL,” she said on Friday.

The government has announced that it would temporarily cancel the plan to ban cars with engine capacities exceeding 1,500 cc from buying subsidized fuels. If the plan were to be executed, the government estimated consumption would be 42 million KL, still above the quota of 40 million KL approved by the House of Representatives.

The 2012 presidential regulation states that only small-scale fishermen, farmers who have land smaller than two hectares, private cars and motorcycles, public transportation vehicles and micro-enterprises can purchase subsidized fuels.

Vehicles of mining and plantation companies are banned from buying the subsidized fuels.

“We’ll strengthen supervision for mining and plantation vehicles,” Evita said.