Indonesian state firm Pertamina has raised some fuel prices by almost a third in the first increase since the Iran war began, and the finance minister said there would be limited impact on inflation amid investor concerns about government spending.
The price of 92-octane gasoline, known as Pertamax and widely used by the country’s middle class, has been raised to 16,250 rupiah (US$0.9053) per litre from 12,300 rupiah per litre, a 32.1 per cent increase.Pertamax Green, a 95-octane fuel blended with ethanol, has been raised to 17,000 rupiah per litre from 12,900 rupiah per litre, a 31.8 per cent rise.
The Pertamax fuels are normally not subsidised, and it was not known if Pertamina would be compensated for keeping the price unchanged since the war began.
The price rises came after Bank Indonesia unexpectedly raised interest rates for the second time in a month on Tuesday to shore up confidence in the currency and budget data last week showed the cost of subsidies for fuel, power and fertilisers had jumped 208 per cent in May from a year earlier.Finance Minister Purbaya Yudhi Sadewa said the inflationary impact of the price rises was expected to be limited because the fuels are not used for public transportation.
The annual headline inflation rate accelerated to an eight-month high of 3.08 per cent in May.
Reuters
