Indonesia's LPG Imports Could Drain IDR 137 Trillion in Foreign Exchange Annually

Jakarta, CNBC Indonesia - The Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia, has revealed the substantial foreign exchange burden on the country due to the continuously increasing imports of Liquefied Petroleum Gas (LPG) each year.

According to Bahlil, Indonesia must spend at least IDR 137 trillion in foreign exchange annually to meet national LPG needs. Of this amount, approximately IDR 80 trillion to IDR 87 trillion is borne by the government in the form of subsidies.

“Do you know? The subsidised LPG price has never been changed since the beginning until now. Now, we spend IDR 137 trillion in foreign exchange on LPG purchases per year. Out of that IDR 137 trillion, the state subsidises IDR 80 to 87 trillion per year, boss,” said Bahlil at the Sinergi Alumni IPB Untuk Bangsa event on Saturday (2/4/2026).

This certainly presents a particular challenge for the government in maintaining national energy resilience while managing subsidies to be more targeted.

Bahlil explained that the current national LPG requirement is around 8.6 million tonnes per year. However, domestic production capacity is still far from sufficient.

At least, from an installed capacity of 1.9 million tonnes, the maximum production realisation is only in the range of 1.6 to 1.7 million tonnes per year. As a result, Indonesia must import around 7 million tonnes of LPG annually.

“The problem is the question I always get: why don’t we produce LPG domestically? Even though we have abundant gas. We no longer import gas, you know. All gas is now produced domestically. We even export 30% of our total gas lifting. But why do we import LPG? Because LPG’s raw materials are C3, C4… C3 and C4 are different from most of our gas, which is C1, C2. C3 and C4 are small, that’s why our domestic industry is small,” explained Bahlil.