Airlangga and Bahlil Reveal the Fate of Indonesia's Subsidised Fuel Prices, Both Say This

Jakarta, CNBC Indonesia - The government has confirmed that the price of subsidised fuel (BBM subsidi) in Indonesia is not yet set to increase, even though world crude prices are currently above the assumption in the 2026 State Budget (APBN 2026).

Coordinating Minister for Economic Affairs Airlangga Hartarto said the government is still monitoring developments in world crude prices before making a decision on subsidised BBM price policies. “Not yet (to raise subsidised BBM prices); our APBN yesterday was US$70 per barrel Indonesian Crude Price (ICP). So we are waiting,” Airlangga said when met at Menara Batavia, Central Jakarta, on Thursday (5/3/2026).

World crude prices have indeed continued to rise above the APBN 2026 assumption of US$70 per barrel. Refinitiv data shows that on Thursday (5/3/2026), Brent reached US$83.82 per barrel, up 3%, while WTI was US$77.17 per barrel, up 3.4%.

The rise in world crude prices is driven by the unresolved war between Iran and Israel, supported by the United States. The conflict has impacted the vital oil artery, the Hormuz Strait, which accounts for around 20.1 million barrels per day of oil movements.

Indonesia is among the countries affected by the Hormuz closure. As an importer, 19% of national oil imports come from the Persian Gulf corridors.

In this regard, Airlangga said the government cannot forecast when the war will end. What is certain is that the government continues to prepare scenarios or alternative options.

In line with Airlangga, Energy and Mineral Resources Minister (ESDM) Bahlil Lahadalia emphasised that a rise in world crude oil prices does not automatically lead to changes in domestic subsidised BBM prices.

Bahlil explained that domestic BBM is divided into two categories: subsidised and non-subsidised. For subsidised BBM such as Pertalite and subsidised diesel, the government will keep prices stable.

“BBM domestically operates in two parts: subsidised and market-priced. If the subsidised petrol Pertalite increases, the price remains the same before any price change by the government,” Bahlil said at a press conference at the Ministry of Energy and Mineral Resources, quoted on Wednesday (4/3/2026).

Meanwhile, for non-subsidised BBM, price adjustments follow market mechanisms in accordance with applicable regulations, including referring to the ESDM Regulation No. 22.

“If non-subsidised this is adjusted to market prices, previously based on Permen 22. If subsidised there is no new policy; the price remains the same, including for diesel,” he added.