Airlines Urge Pertamina to Lower Jet Fuel Price

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  • TEMPO/Dasril Roszandi

    TEMPO/Dasril Roszandi

    TEMPO.CO, Jakarta - Domestic airlines have requested for a decrease in the price of jet fuel in accordance with the standard sale price within the Southeast Asian region. CEO of Garuda Indonesia Emirsyah Satar, said that the price of jet fuel in Indonesia is currently 12 percent higher compared to the regional price despite the decreasing world’s oil price from US$ 110 (Brent), to US$69 per barrel in last Friday’s trading session.

    "We, the members of the Indonesia National Aviation Company Association [INACA], are currently in dialogue with Pertamina on the 12 percent difference of jet fuel price," said Emir.

    Emir said that determining a proper jet fuel price is essential in relation to the upcoming ASEAN Open Sky economic program planned to be initiated next year. If jet fuel prices in Indonesia are expensive, it would become a problem to airlines from neighboring countries.

    Nevertheless, Emir said that Garuda Indonesia's performance in 2015 will remain good. He added that lower jet fuel prices will significantly affect the company’s operational costs. Jet fuel expenses constitute 40 to 50 percent of the airline's total operational costs, in addition to the weakening Rupiah exchange rate.