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AirAsia boss says monopoly behind RI’s pricey jet fuel
Tony noted that there were two or three jet fuel suppliers in Malaysia and that in most countries, airlines had multiple options of supplier.
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Tony Fernandes, CEO of AirAsia parent company Capital A Behad speaks during the celebration of the resumption of AirAsia’s operations at Terminal 4 of Singapore’s Changi Airport on Sept. 15. (JP/Abdur Rahim)
T
he price of jet fuel in Indonesia is the highest in Southeast Asia and could be among the highest in the world, says Tony Fernandes, CEO of AirAsia parent company Capital A Berhad.
Tony noted in a press briefing on Thursday that this had led to increased costs for domestic flight operators in the country, which translated to higher airfares than elsewhere in the region.
“[Jet fuel prices are] 28 percent more expensive compared to Malaysia or Singapore. In Malaysia, the price fluctuates daily, but Indonesia has a different mechanism that we do not understand,” the Malaysian aviation tycoon said during a press briefing on Thursday, as quoted by Bisnis.
Tony attributed Indonesia’s high jet fuel prices to a lack of competition, pointing out that only state-owned oil and gas firm Pertamina was authorized to sell the fuel in Indonesia.
In contrast, there were two or three jet fuel suppliers in Malaysia, he said, adding that in most countries, airlines had multiple options of supplier.
“If there is only one supplier in Indonesia, they can set prices however they please,” he said.
Read also: Long road ahead for Indonesia’s jet fuel industry
