May 28 (Bloomberg) -- Indonesia, the only OPEC member in Southeast Asia, will pull out of the group as aging fields and declining production force the region's biggest economy to boost imports.

Energy Minister Purnomo Yusgiantoro will sign a decree today to exit the Organization of Petroleum Exporting Countries, he told reporters in Jakarta. The nation, a member since 1962, has been considering leaving the body in the past three years.

Indonesia imports about a third of its oil and production has slumped 49 percent from a peak in 1977 partly as disputes with Exxon Mobil Corp. delayed field developments and deterred investments. Subsidies to cap domestic diesel and gasoline prices may exceed $13 billion this year as a lack of refining capacity forces the nation to import fuel.

``Indonesia no longer fits in as an OPEC member because it has become a net importer,'' said Julian Lee, a senior energy analyst at the Centre for Global Energy Studies in London. ``It won't affect OPEC's ability to put more oil onto the market if it chooses to do so.''

The withdrawal from OPEC will help the nation save 2 million euros ($3.1 million) on membership fees a year, according to Purnomo, who failed earlier this year to convince the group to increase oil output in order to lower prices.

OPEC members account for more than 40 percent of the world's oil supply. Crude production from the 12 members within its quota system declined 1 percent last month to 29.74 million barrels a day, according to Bloomberg estimates.

Angola, Ecuador

Indonesia's exit follows the addition of two members. Angola became an OPEC member in January 2007 and Ecuador rejoined the organization in December after a 15-year absence, swelling OPEC's ranks to 13. War-torn Iraq is the only OPEC member without a quota.

Crude oil prices have doubled in the past year to reach a record $135.09 a barrel in New York on May 22 as demand growth outstrips supplies. A weaker U.S. dollar has also prompted investors to buy commodities as a hedge against inflation. Oil for July delivery was at $127 on the New York Mercantile Exchange at 12:13 p.m. London time.

OPEC Secretary General Abdalla el-Badri in Vienna had no immediate comment.

Indonesia's daily crude output has been less than 1 million barrels since February 2004, according to Bloomberg estimates. Production probably fell 0.9 percent to 859,853 barrels a day in April from March, oil and gas regulator BPMigas said April 29.

``If production comes back to give us the status of a net oil exporter then we can go back to OPEC,'' Purnomo said at the Jakarta Foreign Correspondents Club today. ``We are not happy with the high oil price.''

Domestic Fuel Prices

Indonesia raised fuel prices by almost 30 percent this month to reduce the government's subsidy burden of capping pump prices. Without the increase the government may have to spend 190 trillion rupiah ($20 billion) this year, more than the 126.8 trillion rupiah it had budgeted for 2008, before next year's general election.

``This move really plays to the domestic audience,'' said Tony Regan, an energy consultant with Nexant Ltd. in Singapore. ``How can they show concern about domestic oil prices and expect people to pay more at a time when they are also part of an oil cartel that is trying to push prices up.''

Indonesia produced an average 883,000 barrels of crude oil a day in 2006, while its consumption of refined oil products that year was 1.061 million barrels a day, according to the latest edition of OPEC's Annual Statistical Bulletin.

``For OPEC, the loss of the organization's only Asian member leads to the loss of an Asian perspective at meetings and within the secretariat,'' said Lee of CGES. ``It represents a narrowing of the group's geographical and ethnic outlook'' at a time when Asian demand is becoming paramount, though ties forged over 40 years won't disappear, he said.

The last OPEC member to quit the group was Gabon, which left during 1994-1995.

To contact the reporter on this story: Arijit Ghosh in Jakarta at aghosh@bloomberg.net; Grant Smith in London at gsmith52@bloomberg.net

Last Updated: May 28, 2008 07:21 EDT