Long queues form in Indonesia as fuel shortage threatens

Long queues form in Indonesia as fuel shortage threatens
A fuel station worker talks with his colleague as he holds a placard informing customers that fuel subsidy has run out at a fuel station in Jakarta, August 25, 2014.

A number of gas stations in cities and regencies across the country have run out of subsidized diesel and gasoline fuel stocks.

Long queues of motorcycles and cars had formed since the morning at a number of gas stations in Sukabumi city on Monday, despite signboards saying they had run out of diesel fuel and gasoline.

State oil and gas firm Pertamina's Marketing and Trade Division head Hanung Budya said the long queues had taken place in a number of areas over the past few days, especially in Cirebon, Bandung city, Bandung regency, Bogor city and Sukabumi city.

"There is no shortage of fuel, but the long queues are due to panic-buying," said Hanung after attending an energy meeting with members of Commission VII of the House of Representatives in Jakarta on Monday.

He added that the queues were likely caused by misleading information about gas stations running out of fuel.

"We supervise the subsidized fuels at each gas station according to the quota that we have apparently reduced," he said.

He added that Pertamina had reduced the fuel quota nationwide this year from 48 million kiloliters (kl) to 47 million kl.

"If the quota has been reduced nationally, each province will have adjustments down to the gas stations," he said.

According to Hanung, what Pertamina is carrying out is in line with the Downstream Oil and Gas Regulatory Agency (BPH Migas) for controlling subsidized fuel distribution at each gas station and the quota limitation target is effective until the end of the year.

"We have reduced subsidized premium gasoline by 5 per cent, so if a gas station sells 10 tons of the fuel daily, we will cut a supply of 500 liters daily," he said.

Meanwhile, West Java Deputy Governor Deddy Mizwar has urged the community to understand the government's subsidized fuel limitation policy.

"If fuel distribution is not controlled, fuel supplies will not last until the end of the year," Deddy said at the Gedung Sate provincial administrative building in Bandung on Monday.

However, Yogyakarta Governor Hamengkubuwono X has asked Pertamina to keep supplying a sufficient amount of subsidized fuels to his province until Dec. 31.

"The quota needs to be provided fairly and please do not allow scarcity of subsidized fuels to occur in Yogyakarta," he told journalists here on Monday when asked about fuel scarcity in certain places in Indonesia.

The governor said the quota system currently implemented will not be able to meet daily demands. "If the people's demands have to be met every time, the current quota system should not be used," he pointed out.

The central government had started restricting the sale of subsidized fuels in August to control the rapid consumption that has threatened the state's budget.

As a result of this policy, the stock of subsidized gasoline has run out in many fuel stations in Gunungkidul regency and other parts of Yogyakarta.

Meanwhile, the reduction in the subsidized fuel quota for bunker fuel stations (SPBB) by Pertamina under the order of BPH Migas has also threatened sea transportation.

Ferry operators running from Batam, Riau Islands, to a number of provinces have reduced their operations. A number of ferry fleets will stop their operations temporarily if fuel supplies are not restored.

Ferry operations at the Sekupang domestic port were reduced from Aug. 23 to Aug. 25.

Batam Ferry Operator Association (PDS) head Asmadi told The Jakarta Post on Monday that Pertamina had reduced the quota for subsidized fuel at SPBBs, usually used by ferries to refuel.

The cutback has prevented ferries from serving routes taking more than 90 minutes.

"We urge supplies be restored as usual. If the situation persists, our ferry fleets would stop operating," said Asmadi.

He added that the policy to reduce the supply of subsidized fuel has forced ferry operators to reduce their operations and temporarily lay off employees.

According to Asmadi, a solution offered by Pertamina to sell non-subsidized fuel at its depot in Kabil, Batam, is unfeasible because of the additional costs.

"If we do it, we must raise fares, but we cannot raise the fares as we like, as it's in the government's domain," said Asmadi.

Separately, Riau Islands Pertamina Marine and Industry sales representative Saiful Arief Budiman confirmed Pertamina had reduced the fuel quota to gas stations in Batam so as to maintain supply until Aug. 31.

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