Fuel Restriction Doubted

VIVAnews - The Indonesian government will restrict the use of subsidized fuel, particularly premium, as of the coming October. The policy will be applied on cars assembled after the year 2005.

The restriction is aimed at alleviating subsidized fuel consumption which could exceed the quota set in the 2010 Revised State Budget by 36.5 million kiloliters.

Energy observer from Reforminer Institute, Pri Agung Rakhmanto, said that fuel restriction will not cause any significant impact over the budget.

"In a month, the government can only reduce 105 thousand liters. It means that up until the end of 2010, only 315 thousand kiloliters can be saved," he told VIVAnews today, Sept 22.

According to him, the restriction should not be applied by the government this year. On the contrary, the government should instead prepare the removal of fuel subsidy through gradual pricing mechanism. The government may as well restrict fuel consumption to every private auto. "That will be a lot easier and bring huge effect," he said.

However, after the policy is issued, the government must allocate the subsidy to build infrastructures, develop alternative energy, and set up other programs which will support the economy.

Pri Agung said the restriction may not benefit such company as Pertamina because consumers of premium fuel could on the contrary buy fuel from Shell, Petronas, or Total gas stations.

In response to the issue, Pertamina Corporate Communications Vice President, M Harun, said Pertamina will supply mrore Pertamax, Pertamax Plus, and Pertamax Dex fuel to the market. It is planned that the nonsubsidized fuel will be distributed from the Balongan Refineries, Indramayu, West Java.