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Indonesian Crude Price falls further, still below US$50 a barrel
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Energy and Mineral Resources Minister Ignasius Jonan (left) and his deputy, Arcandra Tahar (right), attend a hearing at the House of Representatives. (Antara/Agung Rajasa)
T
he Indonesian Crude Price (ICP), used as a benchmark to calculate non-tax income in the state budget, fell by almost five percent to US$47.09 a barrel in May from the previous month despite global efforts to cut oil production.
In the first five months of this year, the ICP averaged at $49.9 a barrel, higher than the 2017 state budget estimate of $45 a barrel.
“If the oil price keeps hovering at below $50 a barrel, it will be hard to attract investors to invest and conduct exploration activities in the oil and gas sector [...],” Energy and Mineral Resources Minister Ignasius Jonan said at his office in Jakarta on Monday.
Jonan also said that the government was currently in a wait-and-see mode following the decision of several countries, namely Bahrain, Egypt, Saudi Arabia and the United Arab Emirates, to cut ties with top liquefied natural gas and condensate shipper Qatar on Monday, accusing it of supporting extremism and undermining regional stability.
Late last year, the Organization of Petroleum Exporting Countries (OPEC) announced its plan to cut output by 1.2 million barrels of oil per day (bopd) in 2017 in a bid to boost global oil prices.
Moreover, OPEC and other producers, including Russia, agreed in May to extend the deal to cut production by about 1.8 million barrels per day until the end of March 2018. (bbn)
