By: Edwin Febriandi)*
Oil supply has returned to normal after the lifting of the Highest Retail Price (HET). Although it takes time, the current policy on cooking oil is believed to be able to find a new balance point.
The government did revoke the subsidy so that prices returned to their economic value. But don’t get emotional first because this is done to overcome the scarcity of cooking oil in the market. The proof is now that oil is easy to find, not only in supermarkets but also in traditional markets.
To overcome the scarcity of cooking oil, the government also increases the cost of exports, so that exporters do not sell oil abroad, because it is more profitable to sell to the domestic market. This step was taken by the government so that people would no longer be in trouble because of the lack of oil, and then had to queue for hours.
Minister of Trade Muhammad Lutfi stated, “The change in export regulations is carried out so that national stability occurs because oil supplies do not run abroad, so that supplies to the public are safe.” In a sense, the government is thinking about oil stocks so that they are no longer scarce and the price can be driven insanely. If cooking oil is scarce, it is not only ordinary people who are in trouble but also food traders.
Traders who export cooking oil have also been criticized for not complying with the government’s highest retail price, instead distributing basic necessities needed by the community to other places. The public praises the government’s steps to increase export costs so that exporters’ steps have stopped.
The head of the State Intelligence Agency (BIN) Budi Gunawan stated, “This new policy will take time to completely unravel the confusion over the distribution of cooking oil that has been stirring the community for months. In addition to the time factor, this policy also requires consistent implementation and prudent supervision in the field.” In a sense, supervision must be carried out so that there are no deviations when selling cooking oil.
When the subsidy is removed, the price of cooking oil will automatically rise. However, people do not have to worry because there will be a point of balance (equilibrium) due to the smooth supply of oil. In accordance with economic law, when there is no longer a shortage of cooking oil, the price can be reduced so that it will not exceed 50,000 rupiah per 2 liter package.
However, reaching the balance point cannot be done quickly because currently the focus is on facilitating the distribution of cooking oil. If the supply is very smooth and supermarkets and traditional markets are available, then it will only slide to the point of balance. People are asked to patiently wait for it because it will soon happen.
For the time being, people who have difficulty buying premium cooking oil can buy bulk cooking oil available in traditional markets. This type of oil is still subsidized by the government so the price is still 28,000 rupiah per 2 liter package. This price is given because not all people can afford premium packaging.
People don’t have to worry about using bulk cooking oil because it is subsidized by the government. The quality is not too much different, so that bulk oil can still be useful as it should be.
We are just waiting for the time to reach a new equilibrium point for cooking oil so that there is no shortage of basic necessities and consequently prices can be suppressed. Oil is an important need, so the government is trying to keep the price from suffocating the small people.
The equilibrium point for cooking oil prices occurs when the supply starts to run smoothly and no one exports it anymore. However, this point will take time to reach so people are asked to patiently wait. The government is trying to keep food prices stable so it doesn’t bother the public.
)* The author is a contributor to the Pertiwi Institute