Govt plans to shift part of crude oil imports from Middle East to US
Wednesday, March 4 2026 - 02:20 PM WIB
By Pandu Setiabudi
Energy and Mineral Resources Minister Bahlil Lahadalia said Indonesia plans to redirect part of its crude oil imports from the Middle East to the United States, as tensions in the region continue to create uncertainty over supply routes.
Speaking at a press conference on Tuesday (March 3), Bahlil said around 20–25% of Indonesia’s total crude imports currently pass through the Strait of Hormuz. A portion of those volumes will be shifted to US suppliers as a precautionary measure.
He said the government could not predict how long tensions in the Middle East would persist and was preparing a worst-case scenario to safeguard national energy security.
“After conducting our assessment, we cannot predict when this will end — it could be soon, it could take longer. The scenario now is that for crude we source from the Middle East, part of it will be shifted to sourcing from the United States,” Bahlil said.
Read also: Indonesia secures alternative crude supplies as Pertamina tankers remain in Hormuz
Imports from the United States are also linked to a previously signed Agreement on Reciprocal Trade (ART), which includes a commitment to import a certain volume of fuel from the US, he added.
Bahlil emphasized that imports of refined products such as diesel and gasoline would not be affected, as Indonesia does not source these fuels from the Middle East.
“Our diesel imports are already completed. What we are importing now is gasoline, and we do not source it from the Middle East. Instead, we import it from countries outside the Middle East, including Southeast Asia,” he said.
On domestic supply, Bahlil said Indonesia’s crude oil and fuel stockpiles currently exceed the government’s minimum threshold of more than 21 days of consumption. However, he noted that national storage capacity can only accommodate around 25 days of supply.
The government is also assessing the potential impact on the state budget, particularly fuel subsidies. The 2026 state budget assumes an Indonesian Crude Price (ICP) of US$70 per barrel, while current prices have climbed to around US$78–80 per barrel.
Bahlil said higher oil prices would increase subsidy requirements, although they could also boost state revenues. The net impact is still being calculated. He added that there are currently no plans to adjust subsidized fuel prices.
Editing by Reiner Simanjuntak