Fuel Prices Indonesia
Part of: GIZ International Fuel Price database
Also see: Indonesia Energy Situation
Fuel Pricing Policies
| Local Currency: | IDR |
| Exchange Rate: | 8849.6
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| Last Update: | 2011/05/01 |
Transport fuels in Indonesia are highly subsidized. The price for subsidized fuel is fixed and changes on an ad-hoc basis. However, only the retailing companies Pertamina and AKR Corporindo are allowed to sell subsidized diesel and gasoline at the pump (only 88 octance gasoline is subsidized, →App. A2). Other retailers, as e.g. Shell, are only allowed to sell non-subsidized diesel and gasoline (92 and 95 octance). The price difference is immense: As of Feb2011, the subsidized price for 88 octane gasoline was 4500 IDR, while non-subsidized gasoline starts from 8000 IDR (and higher, depending on the quality).
Because the subsidies mean an immense burden for the national budget, several ways of how subsidies can be reduced were investigated for the last years. A proposal in early 2011 was to limit the amount of subsidized fuels sold, e.g. by stopping subsidies for private car owners (while mass transit, industries, etc. still receive subsidies; see →App.A2).
"The prices of one grade each of gasoline and diesel, kerosene (for households and small businesses), and LPG sold in 3-kg cylinders are controlled and heavily subsidized. The prices of other grades of gasoline and diesel are market-based, but Pertamina, and not government, subsidizes LPG sold in larger cylinders, reportedly costing Pertamina Rp. 3.8 trillion (US$0.43 billion) in 2011. The price of LPG subsidized by government has been frozen for years. After raising fuel prices twice in 2005 and once in 2008, government lowered gasoline and diesel (but not kerosene) prices in Dec 2008 and Jan 2009, and has not adjusted prices since. In both 2005 and 2008, government carried out a time-bound, large-scale cash transfer program targeting the poor and near-poor to compensate them for fuel price increases. Government sets an annual subsidized fuel sales quota and fuel subsidy budget, both of which are typically exceeded. Indonesia revised its subsidized fuel quota in 2011 to 40.49 million kl from the original volume target of 38.59 million kl, but the final figure was 41.8 million kl, 8% higher than the original budget. The quota for 2012 is 40 million kl, but consumption is likely to exceed 45 million kl. Annual government expenditure on fuel subsidies soared to US$29 billion in 2011."
(Source: Kojima, Masami. (2013, forthcoming). “Petroleum product pricing and complementary policies:Experience of 65 developing countries since 2009.” Washington DC: World Bank.)
Fuel Prices and Trends
| Gasoline 95 Octane | Diesel | |
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* benchmark lines: green=US price; grey=price in Spain; red=price of Crude Oil
Fuel Price Composition
Price composition.
Transport fuels are highly subsidized in Indonesia, resulting in fuel prices that are among the lowest in Asia. As of February 2011, about 43% of the actual costs of 88 octance gasoline are covered by the government through subsidies (→App. A2)
A detailed price breakdown is not available online, hints welcome.
At a Glance
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Subsidized fuel is on price level "low" with a price mechanism between "ad hoc" and "liberalized"
No official information found yet; hints welcome!
Sources to the Public
| Type of Information | Web-Link / Source |
|---|---|
| Other Information | http://www.globalsubsidies.org/files/assets/ffs_gsiunepconf_sess2_askolani.pdf (Fuel Subsidy Policy in Indonesia) |
| Other Information | http://www.pertamina.com/ (Fuel Subsidy Policy in Indonesia) |
| Other Information | http://uk.reuters.com/article/2010/03/12/indonesia-oil-subsidy-idUKSGE62B0CS20100312 (A1) |
| Other Information | http://www.thejakartaglobe.com/bisindonesia/indonesia-should-delay-fuel-subsidy-limits-minister-says/424765 (A2) |
| Other Information | http://www.iisd.org/pdf/2010/lessons_indonesia_fossil_fuel_reform.pdf (GSI: Lessons learned from Indonesia’s attempts to reform fossil-fuel subsidies) |
| Pump prices and margins | http://www.shell.co.id/home/content/idn/products_services/on_the_road/fuels/our_price/ |
Contact
Please find more information on GIZ International Fuel Price Database and http://www.giz.de/fuelprices
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