Indef: B50 Implementation Improves Trade Balance by Cutting Fuel Imports

Jakarta (ANTARA) - Indef economist Andry Satrio has assessed that the implementation of the B50 biodiesel mandate will improve the trade balance by cutting fuel imports.

“B50 helps the trade balance by cutting fuel imports. Every litre of Fatty Acid Methyl Ester (FAME) replaces one litre of fossil diesel, and at today’s distillate price of around 138 US dollars per barrel, the savings amount to roughly 0.80 to 0.87 US dollars per litre,” Andry said when contacted in Jakarta on Monday.

He noted that this figure is significant precisely because global diesel prices are currently abnormal. While crude oil has fallen to around 72 US dollars per barrel, diesel prices have not followed suit due to distillate supply disruptions in the Strait of Hormuz. As a result, the crack spread—the difference between the price of crude oil and the refined products derived from it—has surged to 70 to 75 percent of the value of a barrel of crude, up from around 27 percent at the beginning of the year.

For context, President Prabowo Subianto has called on scientists and universities to continue developing research in the renewable energy sector so that Indonesia does not stop at the B50 biodiesel mandate. The President stated that biodiesel development must continue towards higher blend levels as part of efforts to achieve national energy self-sufficiency. He revealed that the proposal to move towards B100 had been discussed with his ministers, but the government considers that implementing B50 already delivers a significant impact, including eliminating Indonesia’s dependence on diesel imports. According to Prabowo, the success of achieving B50 is part of a broader government strategy to ensure the nation’s natural resources are utilised to the greatest extent for public welfare.