Apindo: Strait of Hormuz Closure Threatens Indonesia's Trade
Jakarta — The conflict between the United States, Israel, and Iran could have direct implications for Indonesia’s economy. The closure of the Strait of Hormuz and restrictions on commercial vessels in the region are seen as potentially disrupting global trade routes and triggering rising logistics costs in the near term.
Shinta Kamdani, chairman of the Indonesian Employers’ Association (Apindo), stated that the most immediate impact Indonesia would experience from the conflict is disruption to trade routes, particularly those heading towards the Middle East and surrounding regions.
Currently, the Strait of Hormuz, one of the world’s busiest and most strategically important shipping lanes for global energy and goods trade, has been closed and commercial vessels are prohibited from approaching. This closure automatically obstructs the flow of merchant ships carrying goods and commodities, potentially disrupting the smooth distribution of Indonesia’s imports and exports in the near term.
“The most direct and immediate impact of the escalation of the US-Israel-Iran conflict that will be felt by Indonesia is disruption to trade routes, particularly those heading towards the Middle East and surrounding areas. Currently the Strait of Hormuz is closed and commercial vessels are prohibited from approaching,” Kamdani stated when contacted on Sunday, 1 March 2026.
Kamdani believes business actors need to anticipate surging trade costs resulting from the conflict escalation. She noted that heightened security risks have caused shipping insurance premiums to spike as shipping companies and insurers must account for potential losses from the conflict.
At the same time, restrictions on shipping routes and fewer vessels willing to transit the area have caused transport capacity to shrink. This imbalance between vessel supply and shipping demand can trigger rising logistics tariffs, not only to the Middle East but also to Europe and Africa connected via these routes.
As a result, Indonesia’s import and export costs are likely to increase within a relatively short timeframe.
“Besides disrupting trade to the Middle East, we believe we must also anticipate rising trade costs, whether caused by increased burden on trade insurance or by reduced volume of vessels able to transit to the Middle East, Europe and Africa due to this conflict escalation,” she explained.
“These direct impacts could be observed within the next few days to two or three weeks, depending on how the conflict develops,” Kamdani added.
Beyond immediate impacts, the situation could also trigger inflationary pressure domestically, particularly on imported goods from affected regions, from crude oil to consumer commodities like dates. This price pressure could be more keenly felt given its coincidence with Ramadan and Eid periods, when domestic demand increases seasonally.
More broadly, conflict developments need to be anticipated from the perspective of national economic fundamental resilience. Turmoil in the Middle East risks shaking global oil price stability, which ultimately could affect energy import burden, government subsidy burden, foreign currency reserves position, balance of payments, and the rupiah exchange rate.
“Depending on how the conflict develops, we also need to brace the impact of this conflict on the resilience of our national economic fundamentals. This needs particular vigilance because the conflict could shake global oil price stability, which could affect import burden, subsidy burden, foreign currency reserves position, balance of payments, and Indonesia’s exchange rate,” Kamdani said.
Such measures are important to maintain macroeconomic stability and ensure national growth is not disrupted by spillover effects from the global conflict.
“We therefore hope the government can proactively monitor the resilience of our national economic fundamentals and be more agile in creating the productivity stimulus needed, particularly on export and foreign direct investment sides, to keep our national macroeconomic stability conducive to growth and unaffected by spillover from this conflict,” she concluded.