Anticipating the Impact of the Iran–Israel–US Conflict, the Ministry of Industry Strengthens National Industrial Resilience
The escalation of geopolitical conflict between Iran, Israel and the United States (US) raises concerns about global economic stability, particularly in the energy sector, international logistics, and the supply chain of industrial raw materials.
The Indonesian government, through the Ministry of Industry (Kemenperin), continues to monitor developments as they may have indirect impacts on the performance of the national manufacturing sector.
Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said that conflicts in the Middle East region can trigger volatility in global energy prices, disruptions to international trade routes, and increased logistics and raw material costs.
This condition could ultimately affect the competitiveness of the manufacturing industry in various countries, including Indonesia.
“We will continue to monitor the developments of the conflict in the Middle East because the region is one of the world’s energy hubs as well as a global logistics corridor that is very important. Each escalation of conflict has the potential to affect energy prices, the smoothness of supply chains of industrial raw materials, and the logistics costs borne by the manufacturing sector,” Agus said in a press release received by Kompas.com, Friday (6 March 2026).
According to Agus, one of the most influential factors on the industrial sector is the potential disruption of global energy distribution. The Middle East region, especially the Hormuz Strait, is a vital route for the world oil trade.
Around one-fifth of global oil supply passes through that route, so any disruption in the region can trigger a spike in international energy prices.
Military strikes and maritime security threats have caused tanker traffic to decline sharply and increased risks for shipping companies and the maritime insurance industry.
This situation has also triggered a rise in global oil prices. World crude oil prices rose significantly due to energy supply disruptions from the Middle East and rising geopolitical risks in the region.
Agus explained that the rise in global energy prices will directly impact the manufacturing industry because most sectors of industry use energy as a major production cost component.
Industries such as petrochemicals, base metals, cement, fertiliser, and various other processing subsectors are highly sensitive to energy price fluctuations.
“If global energy prices rise over a long period, manufacturing production costs may also rise. This, of course, can affect production efficiency and the competitiveness of industrial products in the domestic market as well as exports,” Agus said.
In addition to energy, geopolitical conflicts can also potentially affect the availability of industrial raw materials sourced from global markets.