Government Moves Quickly to Address Subsidized LPG Policy, Immediate Impact Felt by Public

JAKARTA, investortrust.id – The Indonesian government has swiftly responded to public concerns following the restructuring of the distribution system for subsidized liquefied petroleum gas, or LPG. The policy change, which reclassifies small-scale retailers as sub-distributors, has had an immediate impact on local vendors and consumers.

Slamet Hariyanto, a small grocery store owner in Kampung Mandar, Banyuwangi, expressed relief over the recent policy shift. The revision, enacted under President Prabowo Subianto, allows him to resume selling the the LPG, which is distributed in a distictitive lime green 3-kg cannisters, to residents in remote areas without access to official distribution centers.

“If the policy had remained unchanged, it would have been a major setback for the community. As a retailer, I play a crucial role in ensuring that people in my area have access to affordable gas,” Hariyanto told reporters on Tuesday, Feb 4, 2025.

The announcement was also welcomed by Sakri, another vendor selling LPG in Kampung Mandar. He supported the initial restrictions introduced by Minister of Energy and Mineral Resources Bahlil Lahadalia, which aimed to regulate pricing and prevent unnecessary markups by unauthorized resellers.

“As an official distributor, I sell LPG only to direct consumers, not to secondary retailers. If retailers purchase from us and resell at a markup, the public no longer benefits from the official retail price. For instance, in East Java, the set price is Rp 18,000 per cylinder, but resellers might inflate it to Rp 20,000 or higher,” Sakri explained.

While the policy revision has sparked debate in several regions, Sakri noted that Banyuwangi, particularly Kampung Mandar, remained largely unaffected.

“There have been concerns in other areas, but here in Kampung Mandar, the impact has been minimal. Now that President Prabowo has revoked the restriction on retailers, we have no choice but to comply, as the new rule seeks to address broader concerns in other regions,” he added.

Earlier, Minister Bahlil Lahadalia stated that the government was working on regulations to formalize the role of small retailers as sub-distributors, ensuring that LPG prices remain stable for end consumers. Initially, the ban on retailers was intended to curb price manipulation at the secondary market level.

“In line with President Prabowo’s directives, all existing LPG resellers will now operate as sub-distributors. As of today, these small-scale sellers across Indonesia can resume operations under their new designation,” Bahlil announced on Tuesday.