I Made Sentana, Jakarta – Indonesia's state-owned Pertamina (P.PTM) oil and gas company has raised fuel prices for industrial users to between 50% and 100% of international market prices, effective Sunday, in a bid to reduce government fuel subsidies.

Mining and oil companies operating in Indonesia, ships carrying foreign flags and those sailing to international destinations must pay fuel prices at international market prices, Pertamina announced over the weekend.

Other industries and domestic fishing ships have to pay for oil fuels at 50% of international market prices. Fuel prices for industrial users will now fluctuate in accordance with international fuel price movements.

Pertamina reaffirmed that fuel prices for the public, small and medium enterprises, transportation companies and state-owned electricity company PT Perusahaan Listrik Negara are unchanged.

The government has shelved a plan to increase fuel prices for the public, at least until October, after strong criticism from parliament. The government has been trying to reduce fuel subsidies and ensure these subsidies only reach the poor to ease the burden on the state budget.