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Indonesia’s fuel sales see first decline in five years amid outbreak
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Online motorcycle taxi drivers fill up at the Cikini gas station in Jakarta on April 14, 2020. (JP/Seto Wardhana )
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ndonesia’s fuel sales fell last year for the first time since 2015 as the COVID-19 outbreak reduced demand and disrupted the country’s downstream oil and gas industry.
Sales of oil fuels (BBM) – the pollutive but hard-to-replace and highly politicized commodity – fell by 3.74 percent annually to 72.31 million kiloliters (kL) in 2020 from 75.12 million kL in the previous year, according to data from the Indonesian energy and economic statistics handbook (HEESI) and the Energy and Mineral Resources Ministry’s presentation. The fuel includes subsidized and unsubsidized fuels as well as biofuel.
Fuel consumption last dipped in 2015, when Indonesia’s economic growth slowed down to 4.79 percent, causing fuel sales to fall 4.56 percent yoy from the previous year to 67.55 million kL, HEESI data also showed. The country’s economic growth would hover around 5 percent before the pandemic.
The ministry’s downstream oil and gas director, Soerjaningsih, cited low fuel demand as one of the reasons for fuel distributors to maintain fuel prices in Indonesia, even though global crude oil prices collapsed that year.
“Companies did not lower fuel prices because, during the pandemic, the sales volume was small but the distribution cost, as fixed by the government at Rp 1,800 [13 cent US dollar] per liter, was raised,” she said, referring to a cost that was previously fixed at Rp 1,000 per liter.
She said consumption – both of subsidized and unsubsidized fuels – was expected to reach 75.27 million kL this year, which is higher than last year but slightly lower than in 2019.
