The Discourse On Decreasing Subsidized Fuel Prices Is Considered Still Competitive

Executive Director of the Reforminer Institute, Komaidi Notonegoro. (Photo: Doc. Antara)

JAKARTA - The government is monitoring the movement of world oil prices that continue to fall. This decline is a consideration for the government to adjust subsidized fuel prices.

It is known, world oil prices fell below the level of 100 US dollars per barrel.

One of the triggers, is market concerns over slowing economic growth in a number of countries that could impact oil demand.

Executive Director of the Reforminer Institute, Komaidi Notonegoro, said there were two main subsidized fuel variables, namely oil prices and the rupiah exchange rate.

Therefore, according to him, the movement of world oil prices and the government's view to adjust subsidized fuel prices are normal but of course there are regulations.

"I think it's a normal thing, yes, the regulations already exist, so it's just a matter of looking at the price movements in recent times, what if in the existing regulations from January 24, for example until February 25 to determine the price in March, now of course if now that means being calculated, it should be postponed from 2022," said Komaidi, Tuesday, August 31, evening.

Komaidi said the price of pertalite subsidized fuel with the same quality by other fuel distribution agencies was still competitive. Where other fuel prices tend to be below.

But the point is, if with fuel prices falling roughly in the range of how much, it shouldn't be far from the price sold by competitors.

"Right now there are also RON 90 other perpetrators, so it's just a matter of seeing if they sell Rp. 12,000 while we sell it for Rp. 10,000, meaning it hasn't gone down yet, in the sense that there is still a subsidy room of two thousand issued by the government," explained Komaidi.

Then regarding biodiesel 35 percent or B35, the Commission reminded two things. First, the use of biodiesel from palm products which is also sometimes difficult to obtain. Second, the suitability of this fuel in the industry.

For example, the user association complains or provides notes on the performance of its bio diesel because of its water content, for example, if the truck is identified as having the potential to cause corrosion in fuel tanks, electricity and power plants may also have similar problems. Maybe the problem is a bit different location but in general the same is the problem of corrosion, "concluded Komaidi.

Previously, Coordinating Minister for Economic Affairs Airlangga Hartarto, said the government was monitoring the movement of world oil prices.

World oil prices that continue to fall, he said, are a consideration for the government to adjust subsidized fuel prices.

"Our oil price is still below the subsidy price, so of course its sustainability will be monitored rather than the decline in oil prices," said Coordinating Minister Airlangga.

Meanwhile, he continued, the government decided to maintain the provision of energy subsidies in the midst of the global energy crisis in 2023 in order to maintain people's purchasing power and industrial competitiveness in efforts to recover the economy.

By 2023, the government has set an energy subsidy target of IDR 209.9 trillion, with details of IDR 139.4 trillion for fuel oil (BBM) and LPG (LPG), and IDR 70.5 trillion for electricity subsidies.

In addition to pertalite, Airlangga said, the government will also see the effectiveness of the use of diesel fuel mixtures with biodiesel as much as 35 percent or B35.

"This policy can reduce diesel imports and also reduce the number of subsidies disbursed by the government for this type of fuel," he said.