- Antara/ Ari Bowo Sucipto
VIVAnews - The government is likely in doubt over the plan to rise subsidized fuel prices. In fact, up until April 2014, fuel subsidy budget reached Rp29.2 trillion, 30.4 percent of the targeted Rp95.9 trillion until the end of 2011.
The government seems prudent since every option anticipating increase in the State Budget by virtue of the soaring world's crude oil prices has its own risk.
"There's no better option. Everything is risky," said Acting Chief of Fiscal Policy Agency, Bambang Brodjonegoro, on Friday.
The agency monitored the realized budget absorption of subsidized fuel that was deemed quite high within the first four months of 2011. In the mean time, the government still seeks other options such as increasing the budget or subsidized fuel volume.
It is feared that the rise in subsidized fuel prices will intensify inflation rate. On the other hand, redoubling subsidized fuel volume is seen as ineffective.
Data from the Directorate General of Minerals and Gas at the Ministry of Energy and Mineral Resources shows that the Indonesia Crude Price in the last 4 months strengthened.
In January 2011, the average ICP reached US$97.09 per barrel while in February the price hit US$103.31 per barrel.
The ICP in March was recorded US$113.07 per barrel. In April, it touched US$123.36 per barrel.
Indonesia sets fuel prices at the lowest level compared to other countries in East Asia region due to subsidies.
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