August ICP down to USD67.80 per Barrel

MINISTRY OF ENERGY AND MINERAL RESOURCES

REPUBLIC OF INDONESIA

PRESS RELEASE

NUMBER: 306.Pers/04/SJI/2021

Date: 3 September 2021

August ICP down to USD67.80 per Barrel

The Indonesian Crude Price (ICP) in August 2021 is set at an average of USD67.80 per barrel, or down by USD4.37 per barrel compared to the July ICP of USD72.17 per barrel. One of the factors that triggered the decline is the high projection by Organization of the Petroleum Exporting Countries (OPEC), estimating the oil production will increase by 24,000 barrels per day to 64 million barrels per day in 2021.

"Both OPEC and International Energy Agency (IEA) have projected that oil supplies will increase. This factor has a quite strong effect on the movements of the August ICP," explained Head of Bureau of Communication, Public Information Services, and Cooperation of Indonesian Ministry of Energy and Mineral Resources, Agung Pribadi, in Jakarta on Friday (3/9).

Agung said the IEA reported an increase in the world's oil supply in July 2021 of 1.7 million barrels per day to 96.7 million barrels per day. "Supply is estimated to continue to increase in the next few months," Agung added.

Another factor is the decrease in the US economic growth rate of -0.3% to 6.1% compared to the estimate in the previous month. Additionally, the Energy Information Administration (EIA) has reported an increasing trend in the US distillate stock of 600,000 barrels to 138.5 million barrels compared to the stock in the same period last month.

The Indonesian Crude Price Team highlighted that in the Asia Pacific region, a dwindling ICP was also due to reduced import by:

a. India of 200,000 barrels per day, or down by 5% compared to the same period last year. This is the lowest level in the last eight months, and it has been caused by periodic maintenance of refineries and the impacts of the COVID-19 Delta variant spread.

b. Japan of 480,000 barrels per day compared to the previous month, because of limitation of people mobility to anticipate the spread of the COVID-19 Delta variant.

Another factor is reduced GDP growth in China to 7.9% in quarter 2 of 2021, lower than the growth in quarter 1 of 2021 of 18.3%. For 2022, the country's economic growth has been projected to shrink by -0.3% to 6%, stated the Indonesian Crude Price Team in its executive summary.

The complete development of the average price of main crudes on the international market in August 2021 compared to July 2021 is as follows:

- Dated Brent is down by USD4.22 per barrel, from USD75.03 per barrel to USD70.81 per barrel.

- WTI (Nymex) falls by USD4.72 per barrel, from USD72.43 per barrel to USD67.71 per barrel.

- Basket OPEC lowers by USD3.25 per barrel, from USD73.53 per barrel to USD70.28 per barrel.

- Brent (ICE) shrinks by USD3.78 per barrel, from USD74.29 per barrel to USD70.51 per barrel. (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (08112213555)

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