Indonesia’s August Gasoline Imports Likely to Stay Low

Indonesia's gasoline imports are expected to remain low in August despite increasing driving activity in the southeast Asian country.

Indonesia is Asia-Pacific's largest gasoline buyer, but it has been reducing its imports of the motor fuel since May as government-imposed restrictions and work-from-home orders to curb the Covid-19 outbreak limited car use and led to an unprecedented demand destruction.

Indonesia's gasoline imports are expected to remain at around 5mn-6mn bl (161,000-193,000 b/d) in August, much lower than average monthly import volumes, said traders. Indonesia imported 9.25mn bl (298,000 b/d) of gasoline in August 2019 and bought an average of 10.29mn bl/month (350,000 b/d) last year, according to GTT customs data.

Exports from Singapore, Indonesia's largest gasoline supplier, have also dropped sharply in recent months. Singapore accounted for around 70pc of Indonesia's total gasoline imports in 2019 but exported just 2.88mn bl (93,000 b/d) and 2.33mn bl (78,000 b/d) of gasoline to Indonesia in May and June, respectively, according to the GTT customs data. By comparison, Singapore exports to Indonesia reached 6.1mn bl (203,000 b/d) in April and 7.6mn bl (245,000 b/d) in March this year.

Driving activity has picked up in Indonesia but it will take time to clear high inventories. Pertamina previously booked two Long Range 1 tankers to be used as floating storage for oil products offshore Singapore in April for an initial six-month period. The deal might have included options to extend the charter agreement by three or six months.

Driving activity in the country was around 21.2pc below the 13 January baseline in June but rose to just 1.17pc below the same baseline over 1-19 July, according to mobility data from Apple, which provide an indication of driving activity by tracking direction requests.