Jakarta –
The Ministry of Energy and Mineral Resources (ESDM) began to be wary of the impact of the conflict between Russia and Ukraine. The tension between the two countries has made the trend of world oil prices continue to increase.
Likewise the price of Indonesian crude oil or Indonesian Crude Price (ICP). The provisional development of the ICP for February 2022 as of the 24th was recorded at US$95.45/barrel.
“Temporary data on ICP for February 2022 as of the 24th is US$95.45/barrel. For Brent oil prices, it is already more than US$100/barrel. Since ICP has risen above US$63/barrel (assuming the 2022 State Budget), we continue to monitor and anticipate the impact. Not only the price of oil, but also the price of LPG such as CP Aramco,” said the Head of the Bureau of Communications, Public Information Services and Agung Pribadi in an official statement, Sunday (27/2/2022).
The increase in oil prices also has an impact on other sectors, especially transportation and industries that consume non-subsidized fuel.
“The trend of rising world oil prices can lift the economic price of fuel,” said Agung.
As an illustration, the range of non-subsidized fuel prices in several ASEAN countries, including Singapore IDR 28.50 per liter, Thailand IDR 19,300 per liter, Laos IDR 19,200 liter, Philippines IDR 18,500 per liter, Vietnam IDR 16,800 per liter, Cambodia IDR 16,500 per liter. , Myanmar Rp 15,300 per liter.
It is also feared that the increase in oil prices will affect the state budget. The increase in ICP causes the economic price of fuel to increase, thereby increasing the burden of subsidies for fuel and LPG as well as compensation for fuel in the state budget.
Each increase of US$ 1 per barrel will result in an increase in LPG subsidies of around Rp. 1.47 trillion, kerosene subsidies of around Rp. 49 billion, and fuel compensation expenses of more than Rp. 2.65 trillion.
As is known, subsidies for BBM and 3 kg LPG in the 2022 State Budget are Rp. 77.5 trillion. The subsidy at the time of the ICP was US$ 63 per barrel, if the ICP continues to rise, the burden of the subsidy will be even greater.
“The burden of subsidies, especially fuel and LPG, has also increased and could exceed the assumption of the 2022 state budget. Not to mention the cost of fuel compensation. But what is certain is that the government will continue to secure the supply of fuel and LPG,” said Agung.
In addition, the increase in ICP also has an impact on electricity subsidies and compensation, considering that there is still the use of fuel in power plants. Every increase in ICP of US$ 1 per barrel has an impact on additional subsidies and electricity compensation of Rp. 295 billion.
(hal/dna)
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