Jayanty Nada Shofa, Jakarta – Indonesia is banking on supplies from the US after the Iran war triggers oil price hikes and unstable waters in the Strait of Hormuz.
The Middle East conflict – fueled by the US-Israel attack on Tehran – had caused the Brent crude, the international benchmark, to climb to $82 a barrel, marking a 14-month high. Iran's Revolutionary Guards had reportedly warned tankers in the Strait of Hormuz that no ship could pass through the waterway that made up roughly 30% of the world's seaborne crude oil transits.
Senior minister Airlangga Hartarto said Monday that Indonesia already had a hunch that crude prices would jump. Asked about the government's plans to cool down the spike, Airlangga responded that the state-run energy giant Pertamina would tap into supplies from outside the Middle East – in particular, the US. The country has even made a commercial commitment to import US oil as part of a newly signed deal.
"The government already has memoranda of understanding [MoUs] to secure supply from non-Middle Eastern countries. Pertamina has signed MoUs with American [energy] firms Chevron and ExxonMobil," Airlangga said.
"So, yes, prices will rise, but such spikes happened when the Ukraine [war] broke out. But our American energy supplies will increase. The OPEC+ is also planning to pump up production."
Airlangga gave a vague response to the question of whether Jakarta is open to Russian oil. He responded: "We will monitor what is available, and from which country we can import."
At home, Indonesian companies are mostly worried about the burgeoning risk premium on oil and gas, as well as global logistics costs, according to business lobby Apindo. Uncertainty already hangs over energy prices even without the actual Hormuz blockade.
"Indonesia is a net oil importer. This pressure can potentially raise production costs and narrow the fiscal space if prices exceed the government estimates," Apindo chairwoman Shinta Kamdani told the Jakarta Globe.
Under a newly signed tariff deal, Indonesia had committed to facilitating $15 billion worth of US energy imports, about $4.5 billion of which would be crude oil. The business arrangement also includes liquefied petroleum gas (LPG) orders worth $3.5 billion, and some $7 billion others are in refined gasoline.
Before the latest escalations, the Indonesian government had already floated a plan to reallocate a portion of what it usually imported from the Middle East to the US. This way, the $15 billion deal will not deal a fatal blow to import volumes. News agency Reuters recently reported that OPEC+ had agreed to boost production by 206,000 barrels a day for April following the Iran war-induced oil flow disruptions.
Indonesia reported that its overall oil and gas imports climbed 27.52% year-on-year to $3.17 billion in January 2026.
Source: https://jakartaglobe.id/business/indonesia-banks-on-us-supply-as-iran-war-triggers-oil-price-hik