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Indonesia pulling out of OPEC

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Asian country says it is no longer a net oil exporter

JAKARTA, Indonesia - Declining oil reserves and investment have forced Indonesia to quit the Organization of Petroleum Exporting Countries even as other members cash in on soaring global prices, the energy minister said Wednesday.Purnomo Yusgiantoro said Southeast Asia's only OPEC member no longer belonged among exporting heavyweights like Saudi Arabia, Venezuela and Kuwait.

"Indonesia is pulling out of OPEC," he told reporters, days after his government slashed fuel subsidies that have long protected the poor, forcing prices at the pump to jump by nearly 30 percent. "We are not happy with the high oil price."

Indonesia is the region's largest oil producer, but the nation of 235 million people has had to import for years because of aging wells and disappointing exploration efforts. A weak legal system and red tape has scared foreign investors away, even as consumption rises.

Purnomo said the decision to leave OPEC was made by the Cabinet of President Susilo Bambang Yudhoyono, who said earlier this month the country needed to concentrate on increasing domestic production.

Indonesia, which was among the first to join after OPEC was founded in 1960, will remain a member until the end of the year. It will leave open the option of returning if it can build up a surplus. But right now, the energy minister said, we "are a consuming country."

The nation's oil production of roughly a million barrels a day is at its lowest level in 30 years.


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