National Economic Council Monitors Impact of Middle East Conflict on Indonesia's Energy Supply

Jakarta—Indonesia’s National Economic Council (DEN) is ensuring continued monitoring of the impact of the intensifying Middle East conflict on domestic energy prices and supply, particularly regarding crude oil.

DEN member Septian Hario Seto stated that the government will monitor developments in the Middle East over the coming week to assess the extent of escalation between the United States-Israel and Iran.

Currently, Brent crude futures are trading at $78.57 per barrel, having touched $82.37 per barrel earlier in the day. This figure significantly exceeds the 2026 state budget assumption, where Indonesian crude oil (ICP) was set at $70 per barrel.

According to Seto, if there is no further war escalation, the impact of the conflict would not be severely damaging, despite crude oil prices having already risen. He noted that every crude oil-importing nation will feel the effects of war escalation, particularly if the Strait of Hormuz is closed for an extended period.

“In general, I believe the impact will be seen through energy prices. This may affect the conditions of many countries, especially those importing crude oil,” he said.

Indonesia is among the countries that significantly import crude oil. Seto stated that the government has essentially begun reducing its dependence on energy imports through biodiesel development strategies that optimise domestic natural resources as fuel.

“If we look at the President’s strategy, from the outset we have attempted to reduce import dependence. One example is biodiesel policy and related measures. I believe this is already one mitigation step. We are trying to reduce our oil dependence,” Seto concluded.