Indonesia's Energy and Minerals Ministry reduces fuel subsidy quota for next year

The Energy and Mineral Resources Department (ESDM) has reduced the fuel oil or subsidized BBM quota for 2025, after the government set a subsidized BBM quota of 19.58 million kiloliters in the 2024 national income and expenditure budget (APBN).However, the quota for next year is only 19.41 million kiloliters and the subsidized fuels involved are diesel and kerosene. The Minister of Energy and Mineral Resources said that this downward adjustment was driven by the plan to efficiently distribute subsidized fuels by 2025 and is therefore more targeted. Targeting subsidies allows for fewer quotas to be issued, so that money is saved for the State and funds can be used for priorities.

He then explained that those eligible for fuel subsidies were in the lower and middle economic groups, and he therefore asked luxury car users to move away from subsidized fuel. Nonetheless, the criteria for the target recipients of fuel subsidies are still under discussion, and he admitted that he was not yet in a position to elaborate on the technical plan. He only stated that the plan to limit the targeting of subsidized fuels will be regulated in the ESDM Ministerial Regulation (Permen), and that as soon as the rules and regulations are out, there will be time for publication, which is currently under discussion.