Ministry announces crude price hike to US$ 3.6 per barrel

OIL PRICE - JAKARTA. The Indonesian Crude Price (ICP) has increased to US$63.60 per barrel in March as a result of the planned global supply cut, 3.73 percent higher than the February figure, the Energy and Mineral Resources (ESDM) Ministry announced on Thursday.

The ICP is used as a benchmark to calculate non-tax revenue in the state budget.

“The increase was due to, among others, market concerns about the continuing supply cut, under an agreement between OPEC and several non-OPEC countries to cut production to 1.2 million barrels of oil per day [until June],” the statement said.

The increase in crude oil prices in the Asia-Pacific was also attributed to the maintenance of two Kazakhstan oil fields in Karachaganak and Kashagan, as well as India's increasing demand for crude products as a result of lower exports from Venezuela.

US sanctions on crude exports from Venezuela and Iran were a direct cause of the drastic supply cut from the two countries.

It also reported that the global crude supply had dropped by 160,000 barrels of oil per day (bopd) to 99.15 million bopd, while the combined crude supply of OPEC members had dropped by 220,000 bopd to 30.54 million bopd.

“There was a decline in the operation of 17 oil rigs,” the statement added. 

The ministry projected that global crude oil demand in 2019 would increase by 1.24 million barrels to 99.96 million barrels.

The US Energy Information Administration (EIA) reported that the country's total crude supply in March had dropped to 442.3 million barrels, a decline of 3.6 million barrels from February.