Bahlil Reveals Sources of Indonesia's Oil, Fuel and LPG Imports from Malaysia and the United States

Minister of Energy and Mineral Resources Bahlil Lahadalia has confirmed that the government has prepared several alternative sources for imports of crude oil, fuel, and liquefied petroleum gas (LPG) to anticipate supply disruptions from the Middle East region.

Bahlil explained that the nation’s current energy reserves are above the minimum national standards threshold. He outlined that the government has devised a supply chain diversification strategy sourcing from various countries to avoid dependence on a single region affected by geopolitical conditions.

“So of our total LPG, from 100 per cent of 7.6 million in imports, 70 to 75 per cent we source from America. Twenty per cent from the Middle East, and the remainder from other countries such as Australia,” Bahlil stated during a Full Cabinet Session at the State Palace broadcast online last week.

To secure LPG supplies, the government is diversifying imports by securing contracts with the United States and increasing shipments from neighbouring countries. Most recently, Bahlil confirmed that two additional LPG shipments from Australia would arrive by the end of this month, followed by further cargo supplies in early March to secure stocks through April.

Regarding crude oil imports, he acknowledged that Indonesia currently imports 20 per cent from the Middle East, with the remainder sourced from Africa such as Angola and Nigeria, as well as from Brazil, America, and Malaysia.

“The crude oil we import from the Middle East is indeed 20 per cent from the Middle East. We obtain the remainder from Angola, Nigeria, Brazil, and partly from America and partly from Malaysia,” he stated.

To divert oil supplies from the Middle East, the government will import oil from the United States. However, he noted that shipping duration from the US is considerably longer than from the Middle East. Shipments from the United States take approximately 40 days, far longer than the Middle East route which takes two to three weeks, necessitating long-term contracts.

For finished petroleum products, supplies currently rely on imports from neighbouring countries such as Singapore and Malaysia.

“As for the petrol we import, we import finished petrol. This we import partly from Malaysia and partly from Singapore,” he said.

However, Bahlil acknowledged a recent incident involving petrol imports from Singapore. “Two or three days ago we had purchased oil from Singapore that had departed, tendered by Pertamina through a trader, it had left and entered Indonesian waters, then we were ordered to send it back, two shipments. So now the economy, for this oil matter, normal law no longer applies,” he remarked.

In response to the unilateral cargo withdrawal by the trader, his ministry immediately issued a warning and threatened legal action. This action caused the shipper to back down and promise to return the two fuel shipments by the 18th of this month.

Meanwhile, President Prabowo Subianto reiterated the priority policy of meeting domestic needs before exports. Prabowo ensured that this rule applies not only to oil and gas but also to other commodities such as coal and palm oil, the proceeds of which must be prioritised for the people.

“All of this truly belongs to the Indonesian nation, not to businessmen. You may conduct business but ownership belongs to the Indonesian nation. All natural resources that exist belong to my nation, I want to emphasise this,” Prabowo stressed.