Indonesia to quit OPEC over costly oil

Indonesia has aired the possibility of leaving OPEC before. In 2005 a group of advisers to the government recommended it leaves partly because of the financial costs of membership.

Purnomo said Indonesia needed the Middle East for future oil supplies.

"From a political standpoint, we need the Middle East as an oil supplier in future," Purnomo said.

Indonesia sees daily oil output of 927,000 barrels per day this year, down from 950,000 bpd in 2007, and well short of consumption of around 1.2-1.3 million bpd. It raised fuel prices by an average of just under 30 percent on Saturday, as it struggles to plug the fiscal hole left by soaring crude prices.

But fuel is still subsidised in the country where millions of people live on less than $2 a day, with the government expected to spend billions of dollars keeping fuel costs among the lowest in Asia.

(Writing by Harry Suhartono; Editing by Sugita Katyal and Michael Urquhart)