Heru Andriyanto, Jakarta – Indonesia is moving to diversify its energy import sources away from the Middle East, as disruptions linked to tensions around the Strait of Hormuz highlight vulnerabilities in global supply chains, Energy and Mineral Resources Minister Bahlil Lahadalia said on Tuesday.
The shift comes as two Pertamina tankers carrying crude oil from Saudi Arabia remain stranded in the Gulf region, awaiting clearance from Iranian authorities to safely pass the Strait of Hormuz.
"About 20% of our LPG supply comes from the Middle East. When tensions arise there, we must look for alternative sources – and thankfully, we have secured them," Bahlil said during a press conference broadcast on the government's official YouTube channel.
Indonesia plans to increase LPG imports from countries outside the Middle East, particularly the United States, he added.
For refined fuel products, Indonesia will rely more on supplies from neighboring Southeast Asian countries while boosting domestic production through expanded refining capacity.
A key pillar of this strategy is the Balikpapan refinery, which began operations earlier this year and produces 5.6 million kiloliters of gasoline and 4.5 million kiloliters of diesel annually.
"As a result, our energy import structure will increasingly shift toward crude oil rather than refined fuel products," Bahlil said.
Earlier this month, Bahlil said Indonesia plans to raise LPG imports to 7.8 million tons this year, up from 7.3 million tons previously, with around 70% of supply expected to come from the United States.
Indonesia remains a major LPG importer due to limited domestic production and strong demand driven by subsidized household consumption.
The adjustment follows a $15 billion reciprocal trade agreement signed in Washington last month covering energy commodities, including gasoline and LPG, as part of Jakarta's broader efforts to secure tariff relief from the United States.
"This year, LPG imports are increased to 7.8 million tons, with 70% sourced from the United States and 30% from the Middle East, particularly Saudi Aramco," Bahlil said on March 3.
He warned that ongoing tensions in the Middle East could disrupt energy flows from the region, including supplies linked to Saudi Aramco, while also affecting shipping routes through the Strait of Hormuz – a critical chokepoint for global oil and gas trade.
Source: https://jakartaglobe.id/business/indonesia-shifts-lpg-and-fuel-sourcing-away-from-middle-east-risk