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Pertamina raises LPG price, mulls hiking gasoline price
The 12-kg and 5.5-kg canisters now sell at Rp 187,000 and Rp 88,000 per canister, Pertamina announced on Monday.
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tate-owned oil and gas company Pertamina has increased the price of nonsubsidized liquefied petroleum gas in response to higher global prices.
With effect as of Feb. 27, the price was raised to Rp 15,500 (US$1.08) per kilogram. The move comes just months after the last hike, when the price was upped from Rp 11,500 to Rp 13,500 per kg in December last year.
The 12-kg and 5.5-kg canisters now sell at Rp 187,000 and Rp 88,000 per canister, Pertamina announced on Monday, up from previously Rp 163,000 and Rp 76,000, respectively.
The subsidized 3-kg LPG price, on the other hand, remains unchanged and still refers to the retail price ceiling (HET) determined by local authorities. The average price in Jakarta is Rp 20,850 per canister.
Pertamina Patra Niaga corporate secretary Irto Ginting said the decision to increase prices was based on the rising price of the global LPG benchmark, CP Aramco. As of February, CP Aramco reached $775 per ton, up 21 percent from the 2021 average price of $635 per ton.
“The price [increase is due to] the developments in the oil and gas industry and only applies to nonsubsidized LPG, which accounts for 7 percent of total national LPG consumption,” Irto said in a statement on Monday.
Read also: Markets rise, oil dips after Russia sanctions, but traders on edge
Energy and Mineral Resources Ministry spokesman Agung Pribadi said on Saturday that the ministry would continue to monitor oil prices and the CP Aramco benchmark. Meanwhile, the Indonesian Crude Price (ICP) stood at $95.45 per barrel on Feb. 24.
Oil prices have surged in recent days as concerns over supply disruptions sparked by sanctions against Russia over its invasion of Ukraine outweigh talks of a coordinated global crude stocks release.
Brent crude futures were trading up 4.01 percent at $101.99 a barrel on Tuesday. The benchmark touched a seven-year high of $105.79 after the invasion began last week.
“Since the ICP rose above [the assumed 2022 state budget price of] $63 per barrel, [the energy ministry] continues to monitor and anticipate the impact,” Agung said in a statement.
He went on to explain that the increase in oil prices would also impact other sectors, including transportation, which relies on nonsubsidized fuel.
Read also: Oil prices break $100 on Russian 'military operation' in Ukraine
Gasoline price adjustment
Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan said the government was considering raising gasoline prices amid soaring global oil prices but had yet to decide on the magnitude and timing.
“We are sure to raise [gasoline prices],” Luhut told reporters at a briefing in Bali, as reported by Bloomberg, without specifying possible scenarios the government might adopt.
Pertamina could book losses of $500 million a month if the government did not raise gasoline prices, according to Luhut.
“This is a huge number, so we’re watching it carefully,” he added.
