ICP Weak; Govt Evaluates Subsidized Fuel Price

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  • TEMPO.CO, Jakarta - The government will evaluate the price of subsidized fuel as world oil prices and the ICP (Indonesian Crude Price) continue to fall in recent months. "The Minister requested fuel prices to be evaluated," said Naryanto Wagimin, acting chief of the Oil and Gas Directorate General at the Ministry of Energy and Mineral Resources.

    According to Nuryanto, with the ICP estimated at US$80 to US$85 per barrel in 2015, subsidized fuel prices will not exceed the market price. "The economical price of subsidized fuel is around Rp9,000 to Rp10,000 per liter," he said.

    The government is urged to evaluate subsidized fuel prices after world oil prices continue to plunge in the last three months. In yesterday's trade, oil prices perched at US$65.62 per barrel (West Texas Intermediate) and US$69.65 (Brent).

    Andy Noorsaman Someng, chief of the Oil and Gas Downstream Regulatory Agency (BPH Migas) yesterday said that although world oil prices are down, the government still allocates subsidies for Premium (Pertamina's subsidized gasoline brand), kerosene, and diesel.

    Andy said that world oil prices will cease from declining eventually. Especially since the Organization of Petroleum Exporting Countries (OPEC) is planning to hold a hearing to lower their outputs. "With [OPEC] lowering their level of production, the price of oil will go up."