Bali News / Bali Travel and Holiday Updates

Starting on Monday, December 12th 2008, the government decreased price of subsidized fuel. Gasoline (locally marketed as premium) price was decreased to 5,500 rupiah per liter from its original price of 6,000 rupiah per liter. However other subsidized fuel, solar and kerosene, remained at their original price as the government consider that price of those types of fule have not reached its economic price.

Spokesman of the Ministry of Energy and Mineral Resources, Sutisna Prawira, in the press release on Sunday (November 3th) said that the decision taken by the government to decrease the price was related to decreasing oil price in international market. Price of crude oil in international market has once reached the peak of $147 per barrel, which then continuously went down to reach the current price of $49 per barrel.

The decision to decrease the price has been officially based on the regulation of the Minister of Energy and Mineral Resources No. 38/2008 on retail price of gasolene, kerosene, and solar for households, micro enterprises, fisheries, transportation, an public services dated on November 28th 2008.

Whilst the price of crude oil in international market has decreased, kerosene and solar will not be decreased yet. Official price of kerosene remains at 2,500 rupiah per liter and solar price remains at 5,500 rupiah per liter. Sutisna said that the government will evaluate fuel price every month in comparison to international crude oil price. However, especially for gasoline, the maxumum price will not exceed 6,000 per liter. “The Minister of Energy and Mineral Resources will evaluate retail price of fuel every month, accorning to international market of crude oil. However the maximum prive for gasoline will not exceed 6,000 rupiah,” said Sutisna.

Commenting the announcement, the Director of the Center for Public Policies (Puskepi), Sofyano Zakaria said that the government does not have to decrease price of solar at the same time as gasoline. Even if sopar price gets decreased now, it will not give a positive impact to people’s purchasing power or even decrease price of basic needs. The reason is that the National Public Transportation Union (Organda) decided not to decrease transportation fare. Organda takes the excuse that 500 rupiah decrease on fuel price does not compensate their increasing operational cost.

“Considering the situation, it is better for the government to spend the allocated fund for increasing kuota of rice-for-the-poor or cash assistance (BLT),” said Sofyano.