Indonesia's state-run oil firm PT Pertamina has further cut the price of high-grade fuel products as an anticipatory measure for the open competition beginning next year, when foreign rivals will enter the market.

Pertamina had recently sharply cut prices of high-octane gasoline Pertamax to 5,000 rupiah (50 U.S. cents) per liter from 5, 400 rupiah (54 cents) and Pertamax Plus to 5,200 rupiah (52 cents) per liter from 5,700 rupiah (57 cents), Kompas newspaper reported Friday.

The price cut was the second made by Pertamina since November, when Pertamina was due to end its public obligation service that gave the company a monopoly in fuel retail sales.

"We will prove that Pertamina can sell better products at cheaper prices," Pertamina fuel division head Achmad Faisal was quoted as saying.

The government has extended the monopoly in high-octane fuel until Dec. 31, 2005, and given another year of monopolistic business in subsidized, low-grade fuel retailing.

The decision put an end to decades-long monopolistic fuel retail sales of Pertamina, thus opening the door for the presence of foreign firms in the business.

Oil giant Royal Dutch Shell on Nov. 1 opened its first gas station in the Jakarta suburb of Tangerang and plans to build 400 more across the country.

Malaysia's oil firm Petronas has built a gas station in Cibubur, near Jakarta, and also plans to build hundreds more.

The retail presence of foreign companies had previously been limited to lubricant oil market.

Source: Xinhua