Saturday, 14 December 2019

AirAsia: Indonesia's Avtur More Pricey than Neighbors'

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Markus Wisnu Murti

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  • Air Asia X A330-900 aircraft

    Air Asia X A330-900 aircraft

    TEMPO.CO, JakartaAirAsia Indonesia CEO Dendy Kurniawan hoped the government would review the selling price of aviation turbine (avtur) fuel that remained considerably costly. He said that the avtur price in Indonesia was higher than those of neighboring countries, such as Singapore and Malaysia.

    “This is not a hoax,” said Dendy at the launch event of the book "Flying High" by AirAsia Group CEO Berhad Tony Fernandes at Plaza Senayan, Thursday, July 4.

    Moreover, Dendy continued, the avtur rate in Denpasar, Bali, was 15-20 percent higher compared to that in Jakarta. He acknowledged that state oil and gas company Pertamina spent an additional cost to distribute the fuel, and albeit it was set in rupiah, its component derived from the world’s oil price sold in the U.S. dollar. 

    ReadAirAsia Indonesia Adds Airbus Fleet following New Domestic Routes

    However, if the government sets aside the soaring price of avtur, it will increase the airlines’ burden considering the fuel price contributed 40 percent to the total operational cost of the aviation, Dendy noted.

    “I think airlines don’t want to suffer losses, so does Pertamina. So let’s just get revenue together,” he said.

    Contrary to Dendy, Pertamina's vice president of corporate communications, Fajriah Usman, said on May 16 that the avtur price in Indonesia was relatively cheaper than those of other countries’ distributors as mentioned in Platts.

    FAJAR PEBRIANTO