Amid Global Conflicts, Government Asks Medco Not to Export Oil

Jakarta, CNBC Indonesia - The Special Task Force for the Implementation of Upstream Oil and Gas Business Activities (SKK Migas) has requested Oil and Gas Contractors (KKKS), such as PT MedcoEnergi, to redirect their oil export quotas to domestic refineries. This is an effort to secure domestic oil supplies amid global geopolitical turmoil.

SKK Migas Head Djoko Siswanto explained that they have been working to realise the securing of domestic oil supplies. The government is activating special clauses in company contracts to postpone the delivery schedule of crude oil to foreign markets.

“Medco is just waiting for the letter from the minister (Minister of Energy and Mineral Resources, Bahlil Lahadalia). I have actually sent a letter stating that in the export contract between us and Medco’s foreign buyer, if the government needs it, the delivery can be postponed to the following year,” Djoko said when met at the Ministry of Energy and Mineral Resources office in Jakarta, quoted on Wednesday (8/4/2026).

This effort is being carried out through business negotiations, as the government has not issued an official export ban this year.

Regarding the crude oil selling price mechanism for domestic refineries, Djoko mentioned that Medco is requesting a fair price adjustment so that the transaction does not cause losses to the company.

“Negotiation. Medco wants no gain no loss, meaning if the price in their contract is, for example, ICP plus 1-2 dollars, then Pertamina also 1-2 dollars,” he explained.

The scheme for purchasing oil from domestic supplies is considered far more efficient and beneficial for Pertamina compared to sourcing from abroad. This is because global crude oil prices are surging sharply due to escalating global geopolitics.

Thanks to negotiation efforts and the redirection of supplies from various oil and gas contractors, the absorption of national crude oil production into domestic refineries has now surged. The government notes that almost all of Indonesia’s current oil lifting or supply is prioritised for processing independently in the country.

“It’s improving, it’s improving. 98.2% (domestic oil absorption into refineries), if I’m not mistaken,” he emphasised.