November 26, 2019 / 10:22 AM / 16 days ago

Indonesia subsidised diesel fuel consumption seen topping plan by 1.3 mln kl

JAKARTA, Nov 26 (Reuters) - Indonesia’s consumption of subsidised diesel fuel is expected to be up to 1.3 million kilo litres (kl) over the initial budget of 14.5 million kl, an energy ministry senior official said on Tuesday.

The government provides a maximum subsidy of 2,000 rupiah per litre on some diesel fuel which means the additional consumption might require the government to spend an extra 2.6 trillion rupiah ($185 million) in subsidies at a time when it is struggling to meet its revenue target.

Indonesia expects to spend 142.6 trillion rupiah on energy subsidies this year.

Djoko Siswanto, acting director general of oil and gas at the energy ministry, said the government will tighten its supervision on sales of subsidised fuel but will allow for the additional quota to meet the demand.

“No matter how much it is, we will fulfil the people’s need, as long as they don’t breach rules,” he told reporters. Only certain groups of people are allowed to buy subsidised fuel.

Nicke Widyawati, chief executive of state energy company PT Pertamina, said the company expects to exhaust the 14.5 million kl subsidised diesel fuel quota by the end of the month.

She said the government has asked the company to prepare for the extra supply of diesel fuel for the remainder of the year.

$1 = 14,080 rupiah Reporting by Wilda Asmarini; writing by Fransiska Nangoy; editing by Jason Neely

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