Supervision Tightened Over Subsidized Fuel Sales
The government is considering increasing the prices of subsidized fuels Pertalite and Biodiesel in order to reduce the swelling fuel subsidy..
State-owned energy holding company PT Pertamina should ensure the smooth distribution of subsidized fuel. So far, around 1 million vehicles have been registered for the use of subsidized fuel.
PALEMBANG, KOMPAS — State-owned oil company Pertamina has tightened supervision over the sales of the subsidized fuels Pertalite gasoline and Biodiesel in a number of regions ahead of a planned price hike. Pertamina is continuing with its Targeted Subsidy Program to collect data on vehicles that use Peralite and Biodisel.
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> Fuel Price Hike and Social Protection
> Economic Resilience and Fuel Subsidy
In Palembang on Wednesday (31/8/2022), South Sumatra Governor Herman Deru chaired a coordination meeting to anticipate potential chaos at gas stations ahead of the planned increase in subsidized fuel prices. One anticipatory measure was to prevent panic buying, which could lead to long lines at gas stations.
"Panic buying ahead of a hike in fuel prices is normal. Therefore, it must be anticipated in an appropriate manner,” said Herman.
Subsidized fuel supplies should also reach the targeted recipients. Public awareness and education on the use of subsidized fuel must be further improved.
He also called on Pertamina to ensure that the distribution of fuel supplies would be smooth, both before and after the announcement of the planned increase in subsidized fuel prices. Subsidized fuel supplies should also reach the targeted recipients. Public awareness and education on the use of subsidized fuel must be further improved.
The public relations and CSR manager of Pertamina’s South Sumatra branch, Tjahyo Nikho Indrawan, said the company had increased its distribution hours to avoid any disruptions to the fuel supply to prevent chaos at gas stations ahead of the planned increase in subsidized fuel prices. "The additional distribution hours have been implemented since last month," he said.
In Magelang, Central Java, Magelang Municipal Police chief Adj. Com. Yolanda Evalyn Sebayang said the police had dispatched officers since Tuesday (30/8) the to oversee fuel sales at all gas stations in the city. "We will ensure that no one can buy subsidized fuel several times in a day," he said.
Pertamina’s Region IV marketing operation manager, Hendra Saputra, said his office would not ask gas stations in Central Java and Yogyakarta to limit their sales of subsidized fuel to the public. Each gas station had already implemented a mechanism to restrict sales, because they did not want subsidized fuel sales to exceed the quota set by the government, he added.
“Anytime a gas station reports a shortage, we are ready to augment supplies. We will continue to fulfill requests, even during panic buying," Hendra said in Magelang on Wednesday, following a coordination meeting to anticipate the impacts of a fuel hike in the city.
The government is considering increasing the prices of subsidized fuels Pertalite and Biodiesel in order to reduce the swelling fuel subsidy. Pertalite and Biodiesel are currently being sold at respectively Rp 7,650 and Rp 5,150 per liter, far below their economic (real) prices. The sharp increase in global crude prices has led to a sharp increase in the fuel subsidy, which is expected to reach Rp 502 trillion (US$33.80 billion) by the end of this year.
Khoiri Soetomo, the chairman of the Association of River, Lake and Ferry Transportation Companies (Gapasdap), said in Surabaya on Wednesday that the increase in the Biodiesel price would hurt ferry companies if transportation rates were not increased.
The planned price hikes for Pertalite and Biodiesel is expected to affect a number of sectors. Khoiri Soetomo, the chairman of the Association of River, Lake and Ferry Transportation Companies (Gapasdap), said in Surabaya on Wednesday that the increase in the Biodiesel price would hurt ferry companies if transportation rates were not increased.
Breaking 1 million mark
Meanwhile, Pertamina Patra Niaga reported that until the end of August, as many as 1 million vehicles had been registered for the use of subsidized fuel, either through subsiditepat.mypertamina.id or the MyPertamina application. Vehicles can also be registered at a number of gas stations.
According to Pertamina Patra Niaga corporate secretary Irto Ginting, out of the registered vehicles, 70 percent use Pertalite and 30 percent use Biodiesel.
"From the data, private users still dominate the Pertalite users who have registered. Meanwhile, the composition for Biodiesel is generally balanced between private users and public transportation [services]," he said.
Irto also reminded people who felt they were eligible to use subsidized fuel to register their vehicles immediately. Pertamina Patra Niaga was currently testing the readiness of its QR code verification system in several cities. In future, the Targeted Subsidy Program would be harmonized with the government’s regulation on the distribution of subsidized fuels.
The government has set the 2022 quota for Pertalite at 23 million kiloliters (kl) and for Biodiesel at 14.9 million kl. However, the quota is expected to be surpassed in October due to high public demand as the economy recovers. (BRO/EGI/NIK/RAM/CHE/DIT)