Luhut Outlines Scenario on Impact of Hormuz Strait Closure

Jakarta — Luhut Binsar Pandjaitan, Chair of the National Economic Council (DEN), has expressed optimism that any closure of the Hormuz Strait by Iran will be temporary, given that Iran has economic interests in ensuring the strait remains open. However, current conditions in the Hormuz Strait region and the broader Middle East remain volatile.

“I believe the situation remains volatile, but as we have reported, Iran also has survival interests, so it is unlikely the Hormuz Strait will be closed indefinitely. Therefore, we are preparing for various scenarios, and I believe that over the next one to two weeks, things will improve,” Luhut said following a Cabinet Plenary Session at the Palace on Friday, 13 March 2026.

Luhut emphasised that despite the volatile conditions at the Hormuz Strait, maritime traffic, particularly for oil and fuel transport through the strait, is beginning to improve.

He also noted concerns regarding ship insurance costs, which remain elevated, reflecting ongoing apprehension among various parties about developments in the Middle East region.

“Do not forget, Iran also has economic interests because much of their livelihood depends on oil, and near Iran there is a very large facility for processing their oil into finished products,” he said.