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Indonesia pulls out of OPEC

Indonesia pulls out of OPEC
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First Published: Wed, May 28 2008. 02 30 PM IST
Updated: Wed, May 28 2008. 02 30 PM IST
AP
Jakarta: Indonesia is pulling out of OPEC as it is no longer a net oil exporter, the Minister of Energy and Mineral Resources said on 28 May.
Purnomo Yusgiantoro told reporters it no longer made sense for his oil-producing nation to be a member of Organization of Petroleum Exporting Countries, and that it will quit after its membership expires at the end of the year.
“We are pulling out of OPEC,” he said at a press conference, adding that Indonesia could rejoin the grouping at a later date if its oil production increases.
The country of 235 million people is Southeast Asia’s only member of OPEC. But it has had to import oil because of decades of declining investment in exploration and extraction due to corruption and a weak legal system, which make oil companies wary of doing business in the country.
Last month, President Susilo Bambang Yudhoyono said Indonesia needed to concentrate on increasing domestic production, which has dropped to less than 1 million barrels a day even as consumption rises.
OPEC was first formed in 1960 by founding members Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. Indonesia joined in 1962. Currently, it has 13 members.
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First Published: Wed, May 28 2008. 02 30 PM IST