Indonesia has raised subsidized fuel prices by about 30 percent on Saturday, top officials said, as the government moves to rein in ballooning subsidies despite a risk of mass protests.

The price of subsidized gasoline was raised to 10,000 rupiah ($0.67) a liter from 7,650 rupiah, while that of subsidized diesel rose to 6,800 rupiah a liter from 5,150 rupiah, Energy Minister Arifin Tasrif said.

President Joko Widodo said the decision to adjust fuel prices was a difficult one and was his "last option."

Southeast Asia's largest economy had already jacked up its 2022 energy subsidies to 502 trillion rupiah ($34 billion), three times the original budget, pushed by rising global prices of oil and a depreciating rupiah currency.

If prices were not raised, the budget would have ballooned further to 698 trillion rupiah, Finance Minister Sri Mulyani Indrawati said.

High energy subsidies had previously kept Indonesia's inflation low, allowing the central bank to delay raising interest rates until last month, well behind regional and global peers. The August inflation rate was 4.69 percent.

Hariyadi Sukamdani, head of business group Indonesian Employers Association, said overall price pressure from the fuel price hike would not be too much, expecting inflation to top 6 percent at the end of the year.

Still, accelerating inflation could put pressure on the central bank to tighten monetary policy more quickly. The bank holds a two-day policy meeting ending on September 22.

Fuel prices are a politically sensitive issue in Indonesia, and the changes will have major implications for households and small businesses, as subsidized fuel accounts for more than 80 percent of state-owned oil giant Pertamina's sales.

The last fuel price hike was in 2014, months after Jokowi took office, aiming to free up fiscal space. That sparked protests across the archipelago.

(Source: Reuters with edits)