Minister: Indonesia will allow private fuel retailers import gasoline via Pertamina to meet shortages

The energy minister announced on Friday that Indonesia will allow private fuel retailers such as Shell and BP to import more gasoline via state energy company Pertamina, as their petrol station are running out.

Shell and BP AKR, which operates BP fuel stations, have reported that they are experiencing inventory shortages of some gasoline products. This has been happening since late August. Shell has adjusted its operational hours and personnel.

Indonesia's antitrust agency stated on Thursday that import restrictions on fuel subsidised by the government limit consumer choice, contribute to shortages and may create unfair business practices.

Indonesia ended Pertamina’s retail fuel monopoly formally in 2004. However, the state-owned company remains a dominant force.

Some demand shifted to privately run petrol stations as a result of restrictions on the sale of subsided fuels, and a corruption investigation into Pertamina.

Bahlil Lahadalia, flanked by executives from Shell Pertamina BP-AKR and BP, said Friday that the government will allow more imports through Pertamina. The additional supply should arrive within seven days.

Bahlil stated that private fuel retailers were given a 10% larger import quota than last year. However, the demand exceeded this quota.

He said that 110% of the quota allocated could be used before the end December.

"Therefore the government decided that it would meet the request but in collaboration with Pertamina."

Bahlil said that Pertamina would supply companies with base fuel without any additives so they could blend their own fuel.

Pertamina Patra Niaga (Pertamina’s retail unit) still has 7.52 million kilolitres unused import quota. This is enough to supply private retailers through the end of the year. (Reporting and editing by Fransiska Naangoy and Stanley Widianto)

(source: Reuters)