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Indonesia's jet fuel prices highest in Southeast Asia due to monopoly: KPPU

Tempo - February 6, 2024

Amelia Rahima Sari, Jakarta – Chairman of the Business Competition Supervisory Commission (KPPU) M. Fanshurullah Asa assessed that flight tickets in Indonesia are pricey, and one of the factors is the high price of jet fuel or avtur, which is 22-43 times more expensive than in other countries in Southeast Asia.

"We are informed that jet fuel accounts for 35 percent of an airline ticket price," Fanshurullah, known as Ifan, said at his office in Jakarta on Tuesday, Feb. 6.

Ifan argued that the high price of jet fuel was attributable to monopolistic practices. There is only one jet fuel supplier in the country, namely Pertamina. The KPPU, he stressed, has consistently proposed multiple suppliers "to contribute to our economic growth."

According to Ifan, the government should suppress aircraft fuel prices to reduce airfares. This will increase domestic tourism and boost economic growth. "It would be amazing if [the government] could keep ticket prices cheaper," he added.

To date, state-owned gas and oil giant Pertamina offers jet fuel at varying prices depending on the location of the airport. Based on data from its website, the price of jet fuel as of February 2024 at Soekarno-Hatta Airport in Cengkareng, is Rp13,300 per liter, while at Halimperdana Kusuma Airport in Jakarta, it reached Rp14,524 per liter.

Source: https://en.tempo.co/read/1830423/indonesias-jet-fuel-prices-highest-in-southeast-asia-due-to-monopoly-kpp