JAKARTA, Dec 2 — Indonesia has suspended its membership in the Organisation of Petroleum Exporting Countries (Opec), just a year shy after rejoining the grouping, as the net oil importer could not agree to the group’s production cuts.
Indonesian Coordinating Minister for Economic Affairs, Darmin Nasution, was quoted in the local dailies as saying that Opec’s proposed decision to cut production by about five per cent of the output would not benefit Indonesia.
The decision to freeze its membership was made two days ago just as it did in 2009, as dwindling production meant Indonesia had become a net importer which was against Opec’s statute for full membership.
Indonesian Energy and Mineral Resources Minister Ignasius Jonan, who attended the Vienna meeting, said Indonesia disagreed with Opec’s decision to reduce the country’s crude oil production to 1.2 million barrels per day.
He said the decision meant that Indonesia would have to reduce 37,000 barrels per day (bpd) of its oil production, compared to only 5,000 bpd that was approved in its budget for 2017.
Darmin said that as a net oil importer, a five per cent cut to its crude oil production would not benefit Indonesia, as oil prices were expected to go up.
The minister said the temporary suspension was in the best interest of all Opec members and that crude oil production could still be reduced and Indonesia would not be tied to that decision. — Bernama