Pertamina takes hit on fuel cost as oil prices rise

Jakarta

REBOUNDING crude prices and a weakening rupiah are testing Indonesia's decision to remove petrol subsidies. State oil company PT Pertamina is picking up some of the tab for now, and is signalling it wants that to change.

"Pertamina is taking a loss for the moment," said Ahmad Bambang, the company's Jakarta-based marketing and trading director, explaining that the current retail price of 7,300 rupiah (S$0.77) a litre is 600 rupiah less than the break-even price for Pertamina. "The government had promised us that in the end there will be no loss," he said, without elaborating.