Fuel shortages in several regions are a stark warning that the country is heading toward an energy crisis. After Bali and parts of Sulawesi, Kalimantan, and Sumatra, people in East Java are now struggling to obtain diesel and Pertalite gasoline. Supply shortages could spread to other regions, as quotas for these subsidized fuels are expected to run out before the end of the year.
As usual, the government treats the proem as nothing more than a distribution disruption. But the root cause runs deeper: the fragility of the country's fuel reserves. Worse still, the public has no way of knowing the full picture because the data are not transparent. The issue is not merely how much of the quota remains, but also the actual inventory of each type of fuel. Without valid and open data, even the government has no comprehensive picture of the crisis looming ahead.
Energy and Mineral Resources Minister Bahlil Lahadalia, for example, has said that national stocks of Pertalite and diesel are sufficient for 16 to 20 days. But that figure does not address the problem of uneven distribution among regions. Pertalite stocks in Greater Malang, East Java, for instance, are reportedly sufficient for only 1.3 days. Diesel inventories at the Tuban fuel terminal in the same province stand at just around 5 percent of tank capacity. Strangely, storage tanks for Pertamax, whose stocks the government claims are sufficient for 27 days, are also less than 10 percent full at several depots in the province.
The glaring gap between official claims and reality is a ticking time bomb that could trigger a crisis. This is especially concerning given that supplies of crude oil and refined fuel from abroad remain tight because of tensions in the Persian Gulf. Government policy has made diesel stocks even more vulnerable. While other countries scramble to secure diesel, President Prabowo Subianto claims Indonesia no longer imports it because it has B50, a fuel blend made from palm oil and fossil fuels in equal proportions.
In reality, biodiesel is not yet widely available on the market. The government itself is to blame. Supplies of fatty acid methyl ester (FAME), the feedstock for B50, have been disrupted because companies are struggling to operate their plants due to a lack of capital, after the government withheld tax refund payments.
Apparently, Prabowo is consistently told by his subordinates that fuel supplies are sufficient. Fed reports designed to tell the boss what he wants to hear, it is hardly surprising that Prabowo frequently touts energy sovereignty from the podium. In reality, however, fuel availability is far from secure. The problem lies not only with supply, but also with funding.
Energy subsidy and compensation costs have far exceeded projections. The allocation for this year was initially set at Rp376 trillion, based on a crude oil price of US$70 per barrel and an exchange rate of Rp16,500 to the United States dollar. In the government's latest calculations, assuming crude oil prices of US$96 per barrel and the dollar climbing to Rp17,600, the required funding for subsidies and compensation would reach Rp900.5 trillion.
The government can allocate only Rp490.9 trillion. The remaining more than Rp400 trillion will be paid to Pertamina and PLN next year – if the budget is available. With cash reserves running low, Pertamina has little room to maneuver in securing supplies.
The fuel crisis could spread even faster as consumption continues to rise. In East Java, for example, diesel distribution had already exceeded 86 percent of its quota before October had even ended. More than a dozen cities and regencies in the province are expected to run out of their quotas in November 2026. Pertalite stocks, already thin, could also run out soon as consumers switch from Pertamax following an increase in the price of non-subsidized fuel.
Poor governance and an incompetent government have also left the authorities unable to anticipate changing consumption patterns. Quotas are set without taking evolving demand into account. As a result, shortages are only a matter of time.
These intertwined problems will become even harder to untangle if the rupiah continues to plunge – a decline also driven by the government's failure to manage fiscal conditions and create a favorable investment climate. The upshot is that fuel will become increasingly difficult to find. We must prepare for an even more serious crisis.
– Read the complete story in Tempo English Magazine