Indonesia Poised for Windfall Profits from Iran-Israel Conflict, Says Finance Minister
Jakarta — Finance Minister Purbaya Yudhi Sadewa has projected that Indonesia’s key export commodity prices will rise sharply as a result of the escalating conflict between Iran, the United States, and Israel. This presents a potential windfall profit opportunity that could boost state revenue.
Rising prices for export commodities such as coal, crude oil, palm oil (CPO), and nickel could offset the risk of surging global crude oil prices, which could increase energy subsidy expenditure in the 2026 state budget. The Middle East conflict has disrupted one of the world’s critical energy shipping routes, the Strait of Hormuz.
“Despite facing potential energy subsidy increases and rising debt interest burdens amid windfall profit opportunities from commodities such as coal, CPO, and nickel, the government continues to monitor developments closely, ensuring budget instruments function responsively, and maintaining prudent fiscal management so policy responses remain measured to preserve economic stability and purchasing power,” Purbaya stated during a budget press conference at his office on Thursday, 12 March 2026.
Purbaya noted that coal prices have risen 28% year-to-date to US$107.50 per tonne as of 10 March 2026, exceeding the same period last year by 4.1% year-on-year.
“Coal prices have accelerated due to substitution effects, where European and Asian countries are seeking alternative fuel sources given disruptions to crude oil and liquefied natural gas supplies,” Purbaya explained.
Palm oil (CPO) has risen 14% year-to-date to US$1,110.47 per tonne. However, compared to the same period last year, it remains down 2.8%.
Nickel has increased 4.9% year-to-date to US$17,469 per tonne, and is up 12.7% year-on-year. Copper has also risen 4.3% year-to-date to US$12,954 per tonne, with a significant year-on-year gain of 40.3%. Gold has climbed 19.5% year-to-date to US$5,164.39 per troy ounce, up 75.1% year-on-year.
“Gold prices continue an upward trend reflecting market sentiment shifting towards safe-haven assets. Mineral commodity prices such as nickel and copper are also rising, continuing to support state revenue performance,” Purbaya said.
Benchmark crude oil, Brent, has increased 47.1% year-to-date to US$89.90 per barrel. However, this remains lower than the same period last year, with a year-on-year contraction of 8.2%.
“Crude oil prices briefly reached the US$100 per barrel level, but have since corrected downward following President Trump’s comments suggesting the war will end soon,” he added.