Jakarta (ANTARA News) - Coordinating Minister for Economic Affairs Hatta Rajasa has predicted that subsidized fuel consumption this year will inevitably outstrip the quota of 38.6 million kiloliters set under the 2011 state budget.

"It (subsidized fuel consumption) will inevitably soar. We predict the quota of subsidized fuels will increase," he said here on Sunday.

He noted that the first-semester subsidized fuel consumption exceeded the quota because the assumed global crude price outstripped the government-set target of US$80 a barrel.

"On the price side, the global crude price reached more than US$100, well above our assumed crude price of US$80 a barrel. Consequently, our fuel oil imports rose," he said.

The other factor raising fuel oil consumption was that many power plants still used fuel oils because of inadequate gas supplies, he said.

"Hindrance to the construction of power plants with a combined capacity of 10,000 megawatts, coupled with lower-than-expected gas supplies has posed a problem. Of course, state power utility PLN uses fuel oils to increase power supplies. These will all lead to an increase in subsidy," he said.

But he declined to comment on how much the quota of subsidized fuels would be raised and budget allocations for the subsidized fuel would increase on the ground he still had to wait for the results of a cabinet meeting discussing the matter.

"What is clear, (the quota) will increase and will be part of the revised state budget. We will discuss it at a cabinet meeting and later with the House of Representatives," he said.

State oil and gas company PT Pertamina has proposed an additional quota of 2 million kiloliters of subsidized fuels following a shortage of the commodity in several parts of the country.

Pertamina spokesman M Harun said last Thursday the company had predicted that subsidized fuel consumption until the end of 2011 would reach 40.5 million kiloliters, up by 2 million kiloliters from the quota of 38.6 million set under the 2011 state budget.

"According to our forecast, it (subsidized fuel consumption) until the end of this year will reach 40.5 million kiloliters," he said.

Earlier, the Energy and Mineral Resources Ministry predicted that subsidized fuel consumption this year would reach 41.42 million, well above the quota of 38.6 million kiloliters.

The prognosis is based on subsidized fuel consumption in the five months through May which reached 15.46 million kiloliters.

Under the 2011 state budget, the quota of subsidized fuels has been set at 38.6 million kiloliters consisting of 23.19 million kiloliters of gasoline, 2.32 million kiloliters of kerosene, and 13.08 million kiloliters of diesel oil.(*)
(S012/H-NG/S012)

Editor: Ruslan Burhani
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