Indonesia's state-owned Pertamina has reduced its Indonesian very low-sulphur fuel oil (VLSFO) bunker prices by about 30pc in an effort to compete with other ports, namely Singapore.
Starting today, the company is exempting ocean-going vessels from a value-added tax of 11pc, and it has switched its VLSFO pricing strategy from cost-based pricing to market-based pricing. The strategy has been implemented in three Indonesian ports: Jakarta, Surabaya and Balikpapan.
Pertamina is developing a similar strategy for marine gasoil (MGO) and hydrotreated vegetable oil for the ports of Nipah, Bali, Merak and Ambon.
From January to April, Jakarta VLSFO was pegged at $210-$256/t premium to VLSFO in Singapore, Argus data showed. Following the implementation of the new strategy today, the Jakarta-Singapore premium narrowed to $87/t.
Pertamina has been offering B35 biodiesel for bunkering in the ports of Jakarta, Balikpapan, Benoa and Surabaya since February. Its B35 is comprised of 35pc fatty acid methyl ester made from palm oil and 65pc MGO. From February to mid-May, Jakarta B35 was pegged at a $196-$281/t premium to Singapore B24. Singapore B24 is comprised of 24pc used cooking oil methyl ester and 76pc VLSFO.
