Transportation Minister Asks Pertamina to Lower Avtur Price
Transportation Minister Budi Karya Sumadi has asked state oil and gas firm PT Pertamina to lower the price of aviation turbine (avtur) fuel by 10 percent.
The avtur price is about 20 percent higher than that of other countries, making the domestic airline industry inefficient, he stated after an Investment Award function here on Thursday.
Pertamina is the supplier of avtur fuel to all airports in Indonesia.
“A price difference of 10 percent is fine. We ask (Pertamina) to lower the price, so that the price difference would be 10 percent,” he said.
He stated that he will assign the director general of air transportation at the Transportation Ministry to discuss the matter with Pertamina.
“I will assign the director general of air transportation to go there next week,” he remarked.
In response to the increase in avtur fuel price, the Indonesian National Airline Association (Inaca) has proposed the adjustment of lower tariff, which reaches 40 percent of the upper tariff, to the Transportation Ministry.
Inaca General Chairman, Pahala N Mansury, explained that both Inaca and the national flag carrier Garuda Indonesia had proposed the adjustment of the lower and upper tariffs since mid-2017.
“The lower tariff is currently 30 percent of the upper tariff. We hope it will be increased to 40 percent of the upper tariff as it was,” he added.
Nearly 90 percent of airline`s spending is in the US dollar, and avtur fuel makes up 30 percent of its operating cost. As a result, the airline`s operating cost has now increased 17 percent, including 4-5 percent from the rupiah`s depreciation against the dollar, he pointed out.
courtesy : antaranews.com
photo : Tribunnews.com
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