Indonesia may raise petrol prices as global oil price soars above US$100

JAKARTA: Indonesia will consider raising petrol prices after global oil costs surged, with the government still deciding on the magnitude and timing.

"Because if we don’t raise prices, then Pertamina might collapse, while raising prices would affect the people, so we are calculating this,” Coordinating Minister for Investment and Maritime Affairs Luhut Panjaitan told reporters at a briefing in Bali.

"We are sure to raise it,” adding that the government has a few scenarios in mind, without giving specifics.

Oil had breached US$100 in the aftermath of Russia’s invasion of Ukraine, following months of gains driven by the resurgence in demand from a recovering global economy.

Indonesia’s subsidy bill had already ballooned last year to the highest since 2014, which was before President Joko Widodo drastically cut back energy aid to free up more funds for infrastructure development.

Inflation has remained muted, reaching 2.18% in January to be within the central bank’s target range of 2%-4%, but an increase to administered prices could fan consumer prices.

Covid-19 cases are also on the rise in the country

Indonesia on Friday confirmed 49,447 new Covid-19 cases, raising its tally of infections to 5,457,775, the country's health ministry said.

According to the ministry, the death toll from Covid-19 in the country rose by 244 to 147,586, while 61,361 more people recovered from the disease during the past 24 hours, bringing the total number of recoveries to 4,736,234.