The International Energy Agency (IEA) is questioning the policy of fuel oil subsidies being implemented in Indonesia.
Leonard L. Coburn, IEA's head of energy analysis for Indonesia delegation, said that the fuel oil subsidies policy was not competitive for oil and natural gas investors.
“Investors won't be able to compete with a subsidized-fuel oil market,” he said yesterday (26/6).
Coburn went on to say that a subsidized fuel oil policy also distorted the market so the subsidy was not accepted by eligible parties.
He questioned the government's monitoring system so that subsidies are received by parties that have the right to receive them.
Luluk Sumiarso, Director General of Oil and Natural Gas, said the subsidy policy was related to political policy.
The government, he said, in 2000 planned to eliminate subsidies gradually.
However, the plan was not easy to implement and so far fuel oil subsidies are still being handed out.
“The president will not raise the price of subsidized fuels until 2009,” said Luluk.
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tempo
Labels: Indonesia, Internet News, Market, People
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