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Govt to cut fuel prices within days

An attendant refuels a bajaj (auto rickshaw) at a gas station in Cikini, Central Jakarta, in December 2014

Tassia Sipahutar (The Jakarta Post)
Jakarta
Sat, March 26, 2016

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Govt to cut fuel prices within days

An attendant refuels a bajaj (auto rickshaw) at a gas station in Cikini, Central Jakarta, in December 2014. The government is slated to cut government-mandated fuel prices at the end of the month.

The government is slated to cut fuel prices within the next few days, as global crude oil prices remain low. The new prices would be announced on March 29 or March 30, said Energy and Mineral Resources Minister Sudirman Said.

He reiterated that the decision was part of the ministry'€™s commitment to review fuel prices on a quarterly basis. The government-set fuel prices, however, may not fall by as much as market prices would suggest, as the government plans to keep some of the savings to shore up the budget.

'€œWe are still calculating, but it is only logical that the price will come down, as global prices remain low and our own supply chain is improving,'€ he said at the Office of the Coordinating Economic Minister on Thursday after attending a working meeting on fuel prices.

Bloomberg data shows that the West Texas Intermediate (WTI) crude price has dropped by 18 percent year-on-year (yoy) to US$39.74 per barrel, while that of Brent has come down 30.3 percent yoy to $40.6 per barrel.

On the other hand, the price of liquefied petroleum gas (LPG) would most likely stay unchanged, Sudirman said. The government was looking to improve the margin of existing LPG retailers and distributors and reduce the gap between the LPG'€™s economical price and the current subsidized price. (ags)

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