REPUBLIKA.CO.ID, SEMARANG -- The Indonesian government has decided to raise diesel oil subsidy to Rp2,000 from Rp500 a litre, according to the State Enterprises Minister, Rini Soemarno. The decision was taken at a meeting between the State Enterprises Ministry, the Energy and Mineral Resources Ministry, the Finance Ministry and the state oil and gas company Pertamina, she said while inspecting a fuel oil terminal here on Friday.

The subsidy hike was based on the Indonesian Crude Price (ICP) since January 2018, the Deputy to the State Enterprises Ministry for Mining Businesses, Strategic Industries and Media, Fajar Harry Sampurno, said.

The government would pay the extra subsidy after the distribution of diesel oil in 2018 had been completed, he said.

The extra subsidy was not necessarily incorporated in the revision of the 2018 state budget and did not need approval from the House of Representatives (DPR) as it was based on the ICP, he said.

Also read: Govt to raise energy subsidies in 2018

The government had set the quota of subsidised diesel oil for 2018 at 16.23 million kilolitres. With the increase, the budget allocation for diesel oil subsidy for 2018 increases to Rp32.46 trillion from Rp9.3 trillion previously.

The Rp2,000 a litre subsidy was based on the joint calculations by the government and Pertamina, the acting Pertamina president director, Nicke Widyawati, said.

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