Crude Oil Prices Break Through USD 100 per Barrel
Global crude oil prices have once again broken through US$100 per barrel after fluctuating between US$95 and US$98 over the past week. According to Trading Economics data, the latest trading saw oil prices reach US$101.47 per barrel.
This increase was triggered by the escalation of conflict in the Middle East entering its fifth week. “Market participants are increasingly pessimistic about the chances of a quick resolution, especially after the Iran-backed Houthi group in Yemen became involved amid additional US troop deployments to the region,” stated the Trading Economics analysis, quoted on Monday, 30 March 2026.
The Houthi group previously launched missile attacks on Israel and stated that such actions would continue until attacks on Iran and its allies are halted. Additionally, the group has the capability to target shipping lanes in the Red Sea as well as strategic energy infrastructure in Saudi Arabia.
These attacks add new risks to global trade routes, which were already strained by disruptions in the Strait of Hormuz, a vital route for around 20 percent of the world’s oil and gas distribution.
Executive Director of the Center of Economic and Law Studies (Celios), Bhima Yudhistira, assessed that Houthi involvement will further complicate the situation. He reminded that the impact would be far greater if disruptions extend to the Bab-el-Mandeb Strait, which serves as the gateway to the Red Sea and a main route to the Suez Canal.
According to Bhima, around 12 percent of world trade passes through that route because it is the fastest path between Asia, Europe, and Africa. Previous closures of this route have added up to 15 days to shipping times, increased logistics costs, and made it difficult for ships to obtain insurance protection.
Bhima said the impact on Indonesia would be significant, given that exports to Europe accounted for 13.4 percent of total exports in January 2026.
“If disruptions continue, oil prices could potentially surge to US$120 per barrel, which would accelerate imported inflation, particularly in the food and energy sectors,” Bhima said in a written statement on Monday, 30 March 2026.
Additionally, Bhima said that the distribution of fertiliser raw materials passing through that route is also at risk of disruption, which could pressure the agriculture sector. Pressure on the rupiah exchange rate could also increase due to weakened exports and rising import costs.
Bhima assessed that the government needs to take immediate mitigation steps. These include diplomatic efforts with Yemen to ensure smooth distribution of Indonesian goods, accelerating budget reallocation for energy and fertiliser subsidies, and adding subsidies for public transportation to curb fuel consumption.
“At least, it would require additional government spending of Rp 515 trillion, assuming that every US$1 increase in oil prices per barrel above the state budget assumption adds Rp 10.3 trillion to government expenditure,” said Bhima.
He also emphasised the importance of accelerating the energy transition, particularly in the electricity sector, through the development of renewable energy such as solar, micro-hydro, and wind power. These efforts are crucial to reduce dependence on fossil fuels amid global geopolitical uncertainties.