3 Kg LPG Hard to Find, Effect of Distribution Regulation Transition

JAKARTA, KOMPAS - The government considers the difficulty for residents to obtain 3-kilogram LPG in the market in recent times as a temporary side effect of the transition in the regulation of subsidized gas distribution. Effective from February 1, 2025, the purchase of 3-kilogram (kg) LPG can no longer be done at the retail level, but can only be done at official Pertamina bases. This regulation has resulted in difficulties for residents in various regions of Indonesia to obtain subsidized gas. In a press conference on the performance of Energy and Mineral Resources (ESDM) 2024 in Jakarta, Monday (3/2/2025), the Minister of ESDM, Bahlil Lahadalia, assured that there is no reduction in the quota for 3 kg LPG. The difficulty for residents to obtain 3 kg LPG is a temporary impact of efforts to improve the distribution of subsidized gas to be more targeted. "Please give us a little time, we will resolve this. The product (3 kg LPG) is not scarce, I guarantee that," he said.

Bahlil stated that the prohibition of selling 3 kg LPG at the retail level urgently needs to be implemented to facilitate the government in controlling the price of subsidized gas according to regulations. All this time, he has often found price manipulation at the retail level, making the price of subsidized gas more expensive than the highest retail price (HET). According to Bahlil, the government subsidizes the price of 3 kg LPG by approximately Rp 12,000 per kg or around Rp 36,000 per cylinder. On a different occasion, Minister of Finance Sri Mulyani Indrawati mentioned that with such a subsidy value, the official price of 3 kg LPG should be at the level of Rp 12,750 per cylinder. However, based on Kompas' observations on Monday, in the Central Jakarta area, the price of 3 kg LPG at the agent level was Rp 17,000 per cylinder, while retailers sold it for Rp 20,000 per cylinder. Meanwhile, in the South Tangerang area, the price of 3 kg LPG at the agent level reached Rp 18,000 per cylinder, while the price at the retail level reached Rp 20,000 per cylinder.

Bahlil continued, the government can only control the price of 3 kg LPG according to the HET at official bases. Meanwhile, the price at the retail level is formed by market mechanisms, primarily the supply and demand at the retail level. "I have received many reports that there are people who buy it in unreasonable quantities and then sell it at a higher price than the official stipulation. To regulate this, we have made regulations," said Bahlil. He emphasized that the government's goal in enforcing the purchase of 3 kg gas only at official bases is to make the price easier to control. "If it is later found that the price at the base is increased (not in accordance with the HET), the base's license will be revoked, fines will be imposed, and we will know who the players are," he said.

The government wants to ensure that the selling price of 3 kg LPG is more controlled and uniform throughout Indonesia.

Currently, Bahlil stated that the government is formulating the right distribution strategy so that underprivileged communities can more easily access 3 kg LPG. One of the measures is to make retailers official distribution points if they can meet certain requirements and conditions set.

State Secretary Minister, Prasetyo Hadi, after the Level I Working Meeting of Commission VI of the House of Representatives of the Republic of Indonesia at the Parliament Complex, Senayan, Jakarta, on Saturday (1/2/2025), said that this policy aims to streamline subsidies to be more targeted. He emphasized that the 3 kg LPG is a subsidized item that must be provided to the eligible community. "We hope this subsidy is received by those who are entitled, not to cause difficulties," he said at the Parliament Complex, Jakarta, Saturday, February 1, 2025. The government wants to ensure that the selling price of 3 kg LPG is more controlled and uniform throughout Indonesia. Prasetyo stressed that the government has not raised the price of 3 kg LPG, so if higher prices are found, it is likely due to purchases made outside official bases.

Until this news was released, PT Pertamina (Persero) had not yet provided a response regarding the distribution issues that have made it difficult for the public to access 3 kg LPG despite no quota cuts. However, Corporate Secretary of PT Pertamina Patra Niaga, Heppy Wulansari, had confirmed that there is currently no increase in the price of 3 kg LPG at official bases. The prevailing prices still follow the HET set by each regional government. If higher prices are found, it is highly likely that the LPG was purchased from unregistered retailers. Besides more stable prices, purchasing from official bases also ensures the quality and standard of the LPG, including the certainty of the cylinder's weight according to standards. "Currently, there are 259,226 official Pertamina bases spread across Indonesia, and the government continues to expand the coverage of these bases to make it easier for the public to obtain subsidized LPG," she wrote in an official statement.

It is impossible for small capital entrepreneurs to transform into official Pertamina bases or retailers because a large capital is needed to pay for the purchase of 3 kg LPG in large quantities.

On the other hand, Energy Economics Observer of Gadjah Mada University (UGM), Fahmy Radhi, assessed the regulation prohibiting the sale of 3 kg LPG at the retail level as a blunder policy that kills entrepreneurs at the grassroots level while making it difficult for consumers at the retail level. "So far, retailers have been grassroots entrepreneurs and small shops. The prohibition on retailers selling 3 kg LPG kills their businesses," he said. According to Fahmy, it is impossible for entrepreneurs with small capital to change into Pertamina's official bases or retailers because it takes large capital to pay for the purchase of 3 kg LPG in large quantities. On the other hand, this policy makes it difficult for poor people to access 3 kg LPG which is their right. "The policy prohibiting retailers from selling 3 kg LPG seems to contradict President Prabowo Subianto's commitment to side with the common people, both small entrepreneurs and poor consumers," he said.