Jakarta – Indonesian President Joko Widodo may announce a fuel price hike next week to reduce spending on energy subsidies, said Coordinating Minister for Maritime Affairs and Investment Luhut Pandjaitan on August 19.

Indonesia plans to hike fuel prices next week: Minister, Illustrative image (Photo source: VNA)

The Southeast Asia's largest economy has tripled its 2022 energy subsidy budget to 502 trillion rupiah (33.82 billion USD) amid rising oil prices and a depreciating rupiah.

President Widodo said earlier this week he was considering hiking prices, after Finance Minister Sri Mulyani Indrawati said more money would likely be needed if fuel prices were to be kept unchanged until the year's end.

In a public lecture at a university in the city of Makassar, South Sulawesi, Pandjaitan said his ministry has developed an economic model to ease inflationary impact.

Indonesia's inflation reached a seven-year high of 4.94% in July due to rising food prices. The President has said that had the government not kept fuel prices and some power tariffs unchanged, inflation may have soared higher./.