Industrial Gas Prices Slashed: Will Mass Layoffs Be Averted? Business Leaders Respond

Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia on Monday, 29 June 2026, announced a reduction in industrial gas prices for domestic manufacturing needs. The price of gas purchased by industry via Liquefied Natural Gas (LNG) has been lowered to US$13 per million British thermal units (MMBTU), down from the previous US$20-23 per MMBTU. Bahlil stated that the provision is effective immediately from the time of announcement to provide certainty for domestic industrial businesses. “It takes effect as I speak,” he said when met after a press conference at the DPR RI Building, Jakarta, Monday (29/6/2026). The price reduction policy is specifically targeted at productive downstream industries to minimise the risk of layoffs. However, for other sectors such as power generation, the LNG pricing mechanism will continue to operate normally without similar adjustments. “LNG, yes LNG. This is for industry. This is for industries that produce products. Yes, this is for product-producing industries because we are guaranteeing and want to maintain existing jobs. If it’s LNG for power plants, it’s business as usual,” he said. Chairman of the Indonesian Ceramic Industry Association (ASAKI) Edy Suyanto responded to the government’s move as a swift step that provides a breath of fresh air for the national ceramics industry, especially at a time when the sector was under pressure due to soaring energy costs. Edy added that the impact would be even greater if the government could increase the allocation portion of the Special Industrial Gas Price (HGBT) to around 70%-80%, as was previously implemented. “This step is important to strengthen the resilience of national industry amidst intense regional competition and the influx of imported products, especially from China and India,” he stated. “In addition to potentially saving the industry from the threat of mass layoffs, ASAKI assesses that this policy will also have a multiplier effect on the economy,” Edy added. He further noted that the domestic ceramics industry would actually create 6,000 new jobs. Edy is optimistic that with the government’s latest move, the national ceramics industry can proceed with its expansion plans for the 2025-2029 period. “The plan includes an additional production capacity of around 80 million square metres, an investment value reaching Rp12 trillion, and the potential absorption of around 6,000 new workers. Industry players hope that a more competitive energy policy can be a momentum to accelerate recovery and strengthen the position of the Indonesian ceramics industry in both domestic and international markets,” he said. “We express our highest appreciation to the Government for the attention and swift steps taken. This policy provides certainty for the business world, maintains the competitiveness of national industry, and protects the sustainability of jobs,” said Edy. Previously, the President’s Special Advisor for Employment and Labour Welfare, Said Iqbal, stated that the current wave of layoffs was caused by four main factors, including soaring industrial gas prices. Meanwhile, during the KSPI 2026 National Working Meeting in Jakarta on Tuesday (23/6/2026), Deputy Speaker of the DPR RI Sufmi Dasco Ahmad received a report from the President of the All-Indonesia Workers Union Confederation (KSPSI) Andi Gani Nena Wea regarding the threat of layoffs that could affect up to 55,000 workers. “Respected Bang Dasco. Today, we are experiencing extraordinary difficulties. Two of my largest member factories in Bekasi have closed. That is Granito, and soon Millennium and Mulia Keramik will follow because of industrial gas prices. This is very dangerous,” said Andi Gani. “Next week, within a maximum of ten days, 55,000 people will be laid off. This is a concern for all of us because of industrial gas prices. So this is very terrifying. Soon the textile industry will follow; basically, any industry that uses industrial gas will be in trouble,” he said. The report received an immediate response from Dasco. While delivering a speech before the meeting participants, the Gerindra Party’s Daily Chairman spontaneously contacted the President Director of PT Pertamina (Persero), Simon Aloysius Mantiri, via a phone call that was broadcast to the event attendees. He said the threat of layoffs conveyed by labour groups could not be taken lightly and urged that mitigation steps be taken immediately before thousands of workers lost their livelihoods.