VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

Crude oil prices in the global market went up beyond 1 US Dollar on Friday (4/8). This increase broke the record after six consecutive weeks of rising. The price hike was affected by the decision of Saudi Arabia and Russia - the two most important producer countries - to extend the production cut in September. This caused concern of the offer deficit.

Futures value of Brent oil rose by 1.10 US Dollar or 1.3% and stayed at 86.24 US Dollar. While US West Texas was still at 82.82 US Dollar, rising 1.27 US Dollar or 1.6%. The two are key references for crude oil prices in the international market. This is the highest one since mid-April 2023.

Saudi Arabia on Thursday (3/8) voluntarily extended the production cut up to 1 million barrels per day until the end of September. Saudi Arabia may extend it further. While Russia chose a policy to reduce the crude oil export amounting to 300 barrels per day next month.

With these cuts, experts predicted there would be a deficit in the market up to 1.5 million barrels per day in September, following the deficit in July and August which was predictably around 2 million barrels on a daily basis.

In demand, global crude oil consumption can rise around 2.4 million barrels per day this year. This was stated by Russian Deputy Prime Minister Alexander Novak, after a panel meeting of OPEC+ ministers on Friday (4/8).

The dynamics of crude oil prices which directly affect fuel prices in the future is not easy to foresee. However, experts calculated that the crude oil price in several months will not be going down anytime soon.

On the other hand, China - with their struggling economy after COVID-19 pandemic - must struggle further. Beijing recently announced some stimulus policies to boost their economy. Should China's economy recover, the crude oil demand will rise and consequently price will increase.Other causes that affected the fuel price is inflation in the oil fuel processing industry. The costs of oil fuel production, starting from manpower and energy, are spiking.

The world's oil price spike possibly will nudge the fuel prices in Indonesia. It is not impossible that Indonesia’s state-owned oil company, PT Pertamina, will increase the price of some certain fuel types.