The government plans to slash the Indonesian Crude Price (ICP) assumption by around 40 percent to approximately US$30-40 per barrel in the revised 2016 state budget, due to persistent low global oil prices.

According to Finance Minister Bambang Brodjonegoro, the fall in global oil prices has made the current ICP assumption of $50 per barrel obsolete. Oil prices have moved in a range of $30-35 per barrel recently.

"We must make a new assumption for the oil price. Our estimation is about $30-$40 per barel," Bambang said at the House of Representatives in Senayan, Jakarta on Wednesday.

The government, he continued, would submit its draft on the state budget revision to the House in May, after concluding the 2017 state budget discussions with the House.

The revised ICP assumption would directly affect budget projections on oil and gas revenues, as well as non-tax revenues (PNBP), Bambang said. As of Feb. 5, state revenue reached Rp 94.9 trillion, comprising of Rp 78.8 trillion in tax revenues and Rp 16.1 trillion in non-tax revenues.

Meanwhile, government spending has reached Rp 164.9 trillion, consisting of Rp 100 trillion of village transfer funds, Rp 37 trillion of non-ministries/institutions spending and Rp 27.8 trillion of ministries and institutions spending.

"The state budget deficit has reached Rp 70 trillion," Bambang said. (ags)

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