Jakarta. The Indonesian government is preparing to introduce a single pricing policy for subsidized liquefied petroleum gas (LPG) in 3-kilogram cylinders, in a move aimed at correcting severe regional price disparities and improving distribution efficiency.

Although the government-set retail price for subsidized 3-kg LPG cylinders stands at Rp 19,000 (approximately $1.17), prices in certain regions have surged to over Rp 50,000, sparking public concern over access and affordability.

Energy and Mineral Resources Minister Bahlil Lahadalia said on Friday that the ministry is currently drafting revisions to Presidential Regulations issued in 2007 and 2019 concerning the supply, distribution, and pricing of specific LPG types.

“We’re reforming the distribution mechanism to prevent leakages and introducing a standardized price to avoid arbitrary hikes in the field,” Bahlil said in a statement.

The revised regulations aim to promote equitable access to energy, enhance distribution governance, and ensure that subsidized LPG reaches target groups such as low-income households, microenterprises, fishermen, and farmers.

Under the planned policy, the government would adopt a logistics-based pricing model to unify LPG prices nationwide and eliminate extreme price variations between regions.

One of the key drivers of the current price disparities is the mismatch between state budget allocations for subsidies and the actual cost of distribution, particularly in remote areas. The problem is compounded by inefficiencies in the supply chain and profit-driven practices among some local distributors.

“If prices keep rising, the purpose of state subsidies becomes disconnected from what people actually experience,” Bahlil said.

The ministry expects to roll out the single-price policy starting next year, following the completion of regulatory revisions and a redesign of the distribution framework.

By simplifying the supply chain and aligning subsidies more precisely with their intended beneficiaries, the government hopes to stabilize retail prices, reduce leakage, and enhance energy affordability -- especially for Indonesia’s most vulnerable populations.

Add as a preferred source on Google +