Managing the Energy Burden Amid 5.61 Percent Growth
On 5 May 2026, the Central Statistics Agency announced that economic growth for the first quarter of 2026 stood at 5.61 percent year-on-year. On the same day, the Ministry of Finance released Our State Budget, recording budget realisations up to 31 March 2026. These two pieces of news, if read separately, appear as two different stories. In reality, they are two sides of the same coin. The variable linking them is global energy prices. The conflict in the Middle East at the start of 2026 has triggered volatility in energy commodity prices. Data referenced by the Ministry of Finance shows Brent crude oil prices at $108.2 per barrel, with a year-to-date increase of 77.8 percent. This surge positions energy resilience as a key variable in our macroeconomic landscape. The question is, how prepared is our economy to face it? The good news is that Indonesia’s position is relatively strong. A study by JP Morgan Asset and Wealth Management titled Pandora’s Bog: The Global Energy Shock of 2026, as referenced in the Our State Budget presentation, places Indonesia’s energy resilience at 77 percent, the second highest after South Africa. This position surpasses China, the United States, and Australia. The Economist’s mapping, also referenced by the Ministry of Finance, places Indonesia in the low exposure quadrant with strong buffers. The combination of strong foreign exchange reserves and a maintained government debt ratio forms the foundation of this position. This result is no accident, but the fruit of consistently maintained prudent fiscal policies. However, resilience is not immunity, and this is what we need to examine carefully. The 2026 State Budget assumes an Indonesian oil price of $70 per barrel. Meanwhile, realisations up to April are around $78.5 per barrel. The Ministry of Finance’s latest estimate as of 30 April 2026 even reaches $83.8 per barrel. Energy subsidy and compensation realisations up to 31 March 2026 have reached Rp118.7 trillion, or 26.6 percent of the State Budget ceiling. This is the role of the State Budget as a shock absorber at work, and it is working well.