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Indonesia

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Indonesia has backed away from plans to end the sale of its two most polluting grades of gasoline — Ron 88 and Ron 90 — this year. Furthermore, it has not indicated that it will set a new deadline for removing the two types of gasoline from the market. Both grades fall short of Euro IV specifications, and prices for both are subsidized by the government. Jakarta had been planning to discontinue sales of Ron 88 and Ron 90 in 2022, to help lower the country's carbon emissions and narrow its fiscal deficit. It had originally intended to phase out both grades, but then announced that only Ron 88 would be discontinued, and that Ron 90 would continue to be used during an undefined transition period. Eventually, the government backtracked completely, with President Joko Widodo signing a presidential decree on Dec. 31 authorizing further distribution of both fuels. Analysts say Widodo took this decision to avoid a political backlash. Removing Ron 88 — the cheapest type of gasoline sold in Indonesia — would have been a particularly unpopular move at a time when energy prices are rising.

Topics:
Policy and Regulation, Retail Marketing
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