By Andi Abdussalam |
Jakarta, Sept 28 (Antara) - Private businesses grouped in the National Gas and Oil Entrepreneurs Assocation(Hiwana) has welcomed the government's plan to launch a new liquefied petroleum gas (LPG) product in the market next month.
The government through state-owned oil and gas company Pertamina has revealed that it will launch into the market new non-subsidized 5.5-kilogram (kg) gas cylinders early next month to provide gas alternative for household consumers.Pertamina Marketing Director Ahmad Bambang earlier remarked that his office had made intensive preparations for the launch of Pertamina's new 5.5-kg gas variant to provide a viable alternative to consumers. "Just wait until next month as I am still conducting a survey to finalize its logo. We want its logo, size, and color to be attractive to consumers. Its color can be pink, orange, or purple. The survey to decide the shape of the cylinder is still being conducted, whether it should be skinny, slim, or chubby," Bambang stated recently. |
Senin, 28 September 2015
GAS FIRMS WELCOME PLANNED LAUNCH OF NEW GAS VARIANT
Jumat, 18 September 2015
PERTAMINA READY TO MARKET 5.5-KG LPG CYLINDERS
|
Selasa, 12 Maret 2013
GOVT POSTPONES GAS PRICE HIKE TO OFFSET INFLATION
By Andi Abdussalam |
Jakarta, March 12 (Antara) - The government's decision to postpone
state-owned oil and gas firm Pertamina's plan to increase gas price in
12-kg cylinders this month can help offset inflation that has been high
since early this year.
"The postponement of raising the price of liquefied petroleum gas (LPG)
in 12-kg cylinders is good. We believe it would curb the inflation rate
in March and April," Bambang Brodjonegoro, acting head of the Finance
Ministry's fiscal policy affairs, said.University of Indonesia's economist Lana Soelistianingsih shared Bambang's view, saying that the government decision to postpone the LPG price increase would cut inflation potential by 0.5 percent. "If the government goes on with Pertamina's planned gas price hike, it would contribute multiple inflationary pressures to the economy because prices of food commodities such as onions, garlic, chili and other horticultural products have been skyrocketing. The deferment of the gas price hike will reduce the increasing inflation in the past two months," Lana Soelistianingsih. |
Selasa, 25 September 2012
GAS PRICE HIKES CAN BOOST INFLATION
Jakarta, Sept 25 (ANTARA) - The government must carefully assess its plan to raise the price of liquefied petroleum gas (LPG) in order to ensure that the move does not trigger inflation.
It is feared that the government's plan to raise LPG prices could generate inflation. Moreover, the August inflation rate of 0.95 percent is already higher than the government's earlier projection of 0.7-0.8 percent.
The government's plan to increase the basic tariff of electricity tariff by about 15 percent next year is also likely to boost the annual inflation rate to about 5.1 percent, higher than the 4.8 percent projected by Bank Indonesia (BI).
Therefore, legislator Bobby Rizaldi of the House of Representatives (DPR) Commission VII on energy affairs called on the government to examine the impact of raising the price of non-subsidized LPG before implementing it.
"It should not happen that the hike in the prices of electricity and LPG will cause economic turmoil. Therefore, the government should assess its impact very carefully," he said.
The government is considering the proposal of state-owned oil and gas company Pertamina to raise the price of non-subsidized LPG, including that of the 12-kilogramme cylinder gas.
Director General for Oil and Gas Evita Legowo said recently that the government would "study all aspects and potential impacts of the LPG price hike.
"We will discuss it soon," she added.
Marketing and Commercial Director of Pertamina Hanung Budya stated that his company had made a proposal to the government to raise the price of non-subsidized LPG.
"The proposal was made in order to reduce losses suffered from the distribution of non-subsidized LPG, worth Rp5 trillion, in 2012," he explained. Hanung said the price of the 12-kg LPG cylinder was also proposed to be raised because a majority of buyers of the 12-kg gas were 'financially capable' consumers.
"For people who are financially weak, the government is already providing subsidized gas in 3kg cylinders," he added.
Pertamina distributed 3-kg LPG cylinders among 53.9 million households in the country, with LPG consumption reaching 3.6 million tonnes per year.
"The programme has reduced government subsidies," Pertamina President Director Karen Agustiawan noted.
Earlier this year, Pertamina had made a proposal to the government to pass on the financial burden of gas refilling and transportation, worth Rp200 billion, to consumers in order to offset the losses. "We hope it would be approved soon," Hanung said.
At present, Indonesia's domestic consumption of LPG has reached 5 million tonnes per annum. Of the total, 3.6 million tonnes of gas are subsidized and 1.4 million tonnes are non-subsidized. While 2.2 million tonnes come from domestic production, 2.8 million tonnes are being imported.
Therefore, besides raising the price of LPG in the country, the government will also reduce imports and increase production.
According to Vice President Boediono, the government will increase the production capacity of the domestic LPG industry in an effort to reduce the country's dependence on imported energy.
"LPG imports have been growing rapidly and will continue to do so in the future. Therefore, more investment is needed to increase the production capacity of the domestic industry," he said during his speech at the 25th World LPG Forum at Nusa Dua, Bali, recently.
Bobby stated that the government must focus on the potential impact of the LPG price hike on inflation.
"It is a must for the government to examine its impacts. After all it is also planning to increase the price of electricity," he said on Tuesday.
Bobby pointed out that the increase in gas and electricity prices was likely to boost inflation by more than 1 percent, thereby exceeding the 'safe range'.
"It will have a severe impact on people in the lower income bracket as well as on small- and medium-scale enterprises," he added.
Bobby, who is a member of the Golkar Party, expressed hope that businesses that used 12-kg cylinder gas would not suffer from losses. "Raising the gas price should not be done keeping in mind only the operations of Pertamina but also other aspects and impacts," he said.
"Pertamina must take steps to operate more efficiently by reducing its imports of gas and cutting its transportation costs," Bobby added.
His colleague Dito Guninduto also agreed, saying the ¿government should raise the gas price at a time when the people do not feel it as a heavy burden¿.
"The government must study its plan to raise the gas price from various aspects. Pertamina should continue to suffer losses from the 12-kg cylinder gas business because the product is used by financially capable consumers. But the impact on the inflation must be assessed thoroughly," he added.
Meanwhile, Tulus Abadi, a member of the Indonesian Consumers Institute Foundation (YLKI), said the increase in the price of 12-kg cylinder gas would 'make consumers of 21-kg cylinder gas to move to the subsidized 3-kg cylinder gas'.
"Not only that, cases of 'oplosan' (filling 12-kg cylinders with gas from 3-kg units) will increase due to high price differences," he stated.
"This means that the government's subsidy will increase and there will be a scarcity of 3-kg cylinder gas supply in the market," Tulus added.***2***(T.A014/A/KR-BSR/A/A014) 25-09-2012 21:02:
Selasa, 13 Oktober 2009
STOCKS THINNING AS HOUSEWIVES SHIFT TO 3-KG GAS
Jakarta, Oct 13 (ANTARA) - Many housewives who had been regular users of liquefied petroleum gas (LPG) in 12-kg cylinders have switched to the fuel in subsidized 3-kg cylinders following state-owned oil and gas company Pertamina's decision to raise the price of 12-kg cylinder LPG over the weekend.
"We decided to buy a package of stove and a 3-kg gas cylinder because the price of LPG in 3-kg cylinders is not raised," Maruroh, a housewife in Jember, East Java, said.
On Saturday, October 10, Pertamina raised the price of 12-kg cylinder LPG by Rp100 per kg or Rp1,200 per cylinder on the ground that it was suffering losses with the old price.
With Peramina's decision, the price of 12-kg cylinder LPG at distributor's level would increase from Rp5,750 to Rp5,850 per kg or from Rp69,000 to Rp70,200 per cylinder. While at the retailer's level, the price would increase to between Rp75,000 and Rp78,000 per cylinder because retailers still had to bear transportation and margin costs.
"I have switched to 3-kg cylinder gas because I can then save between Rp21,000 and Rp24,000 on each 12-kg cylinder gas," Mimin, a housewife at Pamulang Villa, Tangerang, Banten, said.
As many housewives --including those economically well-off -- switch to the subsidized gas, stocks of the 3-kg canister gas (designed for low-income people have begun to run low in the markets of certain regions.
In Madiun, East Java, for example, a number of distributors have begun to feel the scarcity of 3-kg cylinder gas stocks.
"Since the increase in the prices of 6-kg, 12-kg and 50-kg cylinder gas, demand for 3-kg canister gas whose price was not raised has drastically increased. Many consumers of the 12-kg have switched to the 3-kg gas," Saptono, an LPG distributor in Madiun, said.
In the meantime, he said, sales of 12-kg gas had dropped 50 percent. He used to sell between 50 to 75 cylinders per day. After the price rise, the sales were only between 25 to 30 cylinders per day.
The Yogyakarta Consumers Institute (LKY) therefore called on the government to review the price increase policy because it put a burden on the people. "Considering the consumers' purchasing power, it appears that the increase in the 12-kg cylinder gas price has put an economic burden on the people," LKY chairman Widjantoro said.
He said that restrictions on who might by allowed to buy 3-kg gas should be imposed because otherwise the increase in the 12-kg gas price would cause turmoil in consumers' demand for the 3-kg gas.
"The problem that we have to solve is how to enable consumers in the lower income bracket to use most of the subsidized 3-kg canister gas," he said. In terms of access to cheap energy, he said, economically weak consumers often find it difficult to obtain cheap energy.
Therefore, as energy is a basic necessary, the government should maintain its subsidy for low-income people. It is the government's responsibility to provide cheap basic necessaries for the people.
"The government should not use market law in deciding prices for basic necessaries. If it does so, prices would continue to increase," Widjantoro said adding that if the prices of non-basic necessaries were left to the market mechanism, probably it would not cause problems.
Therefore, he said, the government should review the price increase of 12-kg cylinder LPG because it would have impact on the people. After all, many upper class consumers have also switched to the 3-kg gas, causing its stocks to run short.
However, Vice President Jusuf Kalla expressed his confidence that the switch in the use of 3-kg gas by consumers who so far had used 12-kg gas would not last longer because it would not be efficient for them to use the smaller canister size.
"I think that would be temporary because those who usually use 12-kg gas are large families. If they use 3-kg gas they will purchase one once in three days and that would not be efficient," the vice president said.
In the meantime, Pertamina has appealed to the public, particularly those of the middle and upper classes not to use 3-kg cylinder LPG because LPG in that canister size was subsidized and was designed for people of the lower income bracket.
It said that Pertamina had suffered losses due to substandard prices of LPG it sold to the public. After all, Pertamina has the right to decide prices of gas, particularly that in larger canisters or 6 kg and above.
In spite of that however, the government will continue to supervise the price of LPG which was raised by Pertamina. Director General of Oil and Gas of the Energy and Mineral Resources Ministry (ESDM), Evita Legowo, said that the government would not abdicate its responsibility with regard to the price increase, even though Pertamina had the full authority to raise it.
"We will continue to supervise it," she said adding that the government had issued three conditions before Pertamina could increase the price of 12-kg cylinder LPG.
She said that the three conditions were the increase should be based on the reference price, the purchasing power of consumers and the continual availability and distribution of stocks.
The director general said that an LPG price which was adjusted to the international market would have the consequences where price would fluctuate. "If the international price declines, the price at home should also be lowered," she said.
The government has issued a ministerial decree on LPG trade regulation. Based on the trade regulation, the prices of 12-kg, 50-kg cylinder LPG or of that without cylinders should be adjusted to the market mechanism or be decided by the corporate body.
However, the corporate body should also gain the government's approval before it could raise prices. The price of subsidized 3-kg cylinder LPG meanwhile is decided by the government.***2***
(A014/A/HAJM/15:45/f001) (T.A014/A/A014/A/F001) 13-10-2009 15:59:46
Rabu, 16 September 2009
GOVT TO GRADUALLY INCREASE LPG PRICE
Jakarta, Aug 15 (ANTARA) - The government is considering raising the price of liquefied petroleum gas (LPG) in 12-kg cylinders in an effort to cover state-owned oil and gas firm Pertamina's losses said to amount to about Rp6 trillion per annum.
However, the plan to increase the price is unlikely to be carried out until after the post-fasting month festivities to avoid boosting the inflation rate in the country. According to Pertamina, the government had agreed to raise the price of 12-kg liquefied petroleum gas (LPG).
"The government has given the green light for the adjustment of the domestic price of LPG in 12-kg cylinders," Pertamina spokesman Basuki Trikora Putra said. But Pertamina has decided not to increase the LPG price until after the post-fasting month or Lebaran festivities. The fasting month will start August 22, 2009 and last 30 days.
"Based on our considerations that consumers should not feel the burden in the runup to the fasting month, we decided not to raise the price until after the lebaran festivities," Putra said.
The State Enterprises Ministry has proposed that the price of liquefied petroleum gas (in 12-kg cylinders be raised by Rp100-Rp200 a month until it reaches its economic level.
"I think that is our proposal," State Enterprises Minister Sofyan Djalil said on the sidelines of a national accounting conference at Hotel Gran Melia recently.
Because the LPG in 12-kg cylinders was not one of the subsidized goods and state oil and gas company Pertamina had been selling it at below its economic price, the company was suffering a financial loss of Rp6 trillion per year, he said.
Therefore, the ministry agreed to an increase in the selling price of LPG proposed by Pertamina, he said.
"The government does not subsidize it (the LPG price). That is why we must think of how it can be raised gradually until it reaches its economic value," he said.
So far, the government has only subsidized the price of LPG in 3-kg cylinder. Last year, the company also proposed a price increase of Rp500 per kg of the 12 kg LPG.
But the proposal last year was rejected by the government on ground that it would put a burden on consumers. Pertamina predicted it would suffer from a loss of Rp3.47 trillion in the 12 kg LPG sales in 2009.
The figure is obtained from calculating the international LPG price assumption at US$505 per ton with the rupiah exchange value against the US currency at Rp11.600 per dollar.
The US$505 price assumption is based on the contract price (CP) of Aramco in January 2009. With that reference, the economic viability price of LPG at the consumer level is Rp8,943 per liter. With a sale price at Rp5,750 per liter at the consumer level and with a sale target for 12 kg LPG of 1,085,430 tons this year, the losses expected to be suffered by Pertamina would reach Rp3.47 trillion.
With regard to the plan to raise the gas price, National Development Planning Minister Paskah Suzetta said that Pertamina should withhold its plan and consult with the government in the first plance.
"LPG concerns the interest of many people so that a plan to raise its price needs to be consulted to the government. The government will look at it first, and if need be it should provide a bigger subsidy," Paskah Suzetta said.
The minister said that even though LPG in 12- kg cylinder was not included in the items of subsidized goods, a increase in its price would boost inflation.
After all, in the coming several months there would be holidays such as the post-fasting month festivities that could generate the inflation rate.
Legislator Hafiz Zawawi who is also chairman of the House Commission for national development affairs, said that it would be risky to raise the price of LPG at present because it could cause high inflation.
Besides, an increase in the LPG price will create impacts on the assumptions several posts in the state budget. "It would boost inflation and bring changes to several assumptions in the state budget," Zawasi said.
A researcher of Bank Indonesia (BI/the central bank) said an increase in the 12 kg LPG price would boost the inflation rate, much more after the success of the government's kerosene-to-LPG conversion program which caused more people used the gas.
At present, the 12 kg LPG price is Rp5,750 per kg, while that of with the 50 kg cylinder is set at Rp7,000 per kg so that Pertamina has to provide a subsidy. Moreover, the 12 kg LPG is not included in the items that enjoyed a subsidy in the state budget.
State Enterprise Minister Sofyan Djalil said previously that he had agreed to the plan of Pertamina to raise the price because the 12 kg LPG was not a commodity which was provided with a subsidy. Much more, Pertamina is predicted to suffer a loss of Rp6 trillion in subsidy. Thus, Pertamina is planning to increase the LPG price in stages each month about Rp100 - Rp200 per kg until it reaches its economic viability price.***2*** (T.A014/A/HAJM/13:10/f001 )