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The Indonesian government announced on Tuesday that it will maintain current fuel prices despite intensifying budget pressures caused by the ongoing war in the Middle East.
In a statement released to the public, officials confirmed that there will be no price increases for either subsidised or non-subsidised fuels starting April 1.
This decision comes as the government moves to protect household purchasing power and maintain macroeconomic stability amidst a surge in global crude oil prices, which have recently trended toward $100 per barrel.
In addition to the price freeze, the government issued a strong warning against “misinformation” and rumours of a pending hike that have triggered concerns of a domestic energy crisis.
Authorities urged citizens to remain calm and avoid panic buying, noting that national fuel reserves are currently at a secure 23-day level.
To manage the fiscal burden of these subsidies, which now account for approximately 5% of the annual budget, the administration has introduced alternative cost-cutting measures, including a slight reduction in the “Free School Meals” programme and a transition to remote work for some civil servants.
While regional neighbours like the Philippines and Sri Lanka have declared energy emergencies or implemented significant price hikes, Indonesia’s Finance Ministry maintains that the state budget remains resilient enough to absorb the current price disparity.
Indonesia wants to avoid the instability of the Strait of Hormuz by getting oil from the US, Nigeria, and Brazil instead.
The government has vowed to continue monitoring global developments closely but reiterated that no policy changes are expected for the immediate future.
