JAKARTA (TheInsiderStories) – Indonesia’ energy and mineral resources (EMR) ministry ordered the top refiner, PT Pertamina to limit the purchase of crude oil from overseas to tackle a current account deficit (CAD), said the official today (01/14) as reported by local media.
The government only allows the state-owned company to import 50 million barrels (Mbbl) of crude in this year, below 2019′ numbers 80 Mbbl.
According to acting director-General of oil and gas at EMR ministry, Djoko Siswanto, later on the producer its expecting absorb the needs from domestic market. Last year, the energy holding company bought about 120,000 barrels a day from local producers. This year the amount its expecting can lift to 200,000 barrels of oil per day.
As reported, President Joko Widodo, has criticized his ministers due to the country’s widening CAD. The head of state rated his ministers performance were considered not enough to overcome the economic problems, especially on import and export issues.
Bank Indonesia (BI) data showed, the country’ CAD decreased to US$7.7 billion in the third quarter (3Q) of 2019 from $8.2 billion gaps a year earlier, equivalent to 2.7 percent of the country’s gross domestic product. The lower deficit was supported by an increase in the goods trade balance surplus, which was accompanied by a lessen in the oil and gas trade balance deficit.
With the improvement in the current account and capital account deficit, Indonesia’ balance of payments (BoP) in the 3Q recorded a deficit of $46 million, lower than the deficit in the previous quarter of $2 billion. BI sees Indonesia’ BoP in 2019 and 2020 will be in the range of 2.5 to 3.0 percent of GDP.
The official data showed, Indonesia’ daily crude oil production is about 750,000 barrels, while total consumption is estimated at 1.3 million to 1.4 million barrels a day.
Siswato claimed ready to provide an incentives in order to encourage the acceleration of development plans for oil and gas fields to boost the domestic production. He revealed, there were around 42 development plans that had not yet been executed.
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