Indonesia’s Pertamina continues to see its purchasing power in the international oil markets deteriorate as its domestic currency, the rupiah, extends sharp losses against the US dollar, a trend that is forcing the state-run energy firm to buy cheaper gasoline grades and cut crude imports. The US dollar/rupiah exchange rate surged above Rupiah 14,700 this week, the highest level since September 29, 2015, and up by more than 8% from Rupiah 13,542 at the start of the year. The rupiah’s sharp weakness against the US dollar has significantly increased Pertamina’s crude and fuel procurement cost burden so far this year, making a case for the company to focus more on importing lower octane gasoline grades, primarily 88 RON, rather than the higher octane 92 RON and 95 RON gasoline specifications. Pertamina plans to import around 11 million barrels of gasoline in September, trade sources with knowledge of the matter said. Market watchers were unable to provide a breakdown of volumes between the three 88 RON, 92 RON and 95 RON gasoline grades for the September imports, but recent spot market activity from Pertamina was focused on the economical 88 RON grade. Pertamina in July issued several tenders to buy up… continue reading
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Source: CTRM Center