Energy analyst Pri Agung Rakhmanto and legislator Satya W Yudha of the Golkar faction in the House of Representatives (DPR) were among other parties who asked the government to increase fuel oil prices.
Pri Agung said that the most realistic option to off set subsidy in the state budget was to increase fuel oil prices.
"In term of time, the restriction option is no longer relevant to be imposed to overcome the swelling of subsidy budget this year," he said.
Pri Agung, who is also executive director of ReforMiner Institute, said that restriction option had high distortion potentials such as abuse of subsidized fuel oil in black markets so that it would not be effective to be implemented at present and in the future.
The same opinion was also raised by Sapta Yudho who said that Law on State Budget in 2011 allowed the government to raise the price of subsidized fuel oil if the Indonesian Crude Price (ICP) had reached 10 percent above the assumed figure of 80 US dollars or 88 US dollars per barrel as set in the state budget.
"This means that the government already has the legal argument to increase the price of fuel oil. So, what else is the government waiting for,?" he questioned.
The subsidy set in the 211 state budget amounted to Rp92.79 trillion.
Pri Agung reminded that it was urgent for the government to increase the price of fuel oils.
He said that each one dollar increase per barrel in the ICP over the assumed figured of 80 US dollar would raise the subsidy by Rp2.7 trillion.
Thus, he said, the realization of an average price of ICP at 111 US dollar, or an increase of 31 US dollar, would increase the subsidy for fuel oil and electricity to Rp83.7 trillion.***5***
(A014/A/HAJM/21:23/a014)
(T.SYS/A/A014/A/A014) 04-07-2011 20:17:37
Editor: Priyambodo RH
Copyright © ANTARA 2011
