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View all search resultsFuel price hike puts further strain on workers, economy
The most recent fuel price hike puts further strain on middle class consumers by driving up commuting costs and adding to overall inflation at a time when many workers are struggling with dim employment prospects.
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An attendant walks across a gas station belonging to state-owned energy company Pertamina in Kuningan, South Jakarta, in October 2023. (JP/Seto Wardhana)
T
he most recent fuel price hike has put further strain on middle class consumers by driving up transportation costs and adding to overall inflation, at a time when many workers are struggling with dim employment prospects.
State-owned energy company Pertamina raised the price of its most consumed unsubsidized gasoline brand, Pertamax, by 32 percent on Wednesday, after months of holding off an adjustment despite skyrocketing global oil prices.
Lea Citra Santi Baneza, a worker in Jakarta who routinely commutes using a motorcycle running on Pertamax, said the increase was “significant” and that she might have to cut less necessary expenditures to cope with the hike.
Much like other middle class workers, Lea said her monthly income so far had always been enough to cover basic needs and still have some left for pleasure, but that may change in the coming months.
“I will have to tighten the belt,” Lea told The Jakarta Post on Friday, after pointing out that she had noticed price increases in food as well, which was “more worrying”.
Fuel price hikes feed through to general inflation through higher distribution costs. Food prices in Indonesia and other countries are already under pressure due to the crisis in the Middle East, where much of the world’s fertilizer and packaging inputs are sourced.
Food prices were already the main driver of inflation last month, even though only the prices of more expensive fuels had been adjusted by then.
