Oil Price at 100 USD, Prasasti Warns of Fuel Price Hike Risks

JAKARTA, KOMPAS.com - The Prasasti Center for Policy Studies is reminding business actors and the public to remain alert to the potential rise in energy prices amid global turbulence.

The government has decided not to increase fuel prices, even though global oil prices have reached 100 USD per barrel. This situation provides short-term relief.

However, risks persist. Policy changes are deemed possible if pressures continue.

Prasasti’s Board of Experts and energy expert Arcandra Tahar assesses that Indonesia lacks significant room to independently determine oil prices.

“Oil prices fundamentally follow market prices. Indonesia buys on the market. Domestic production, whether through K3S (Contract Work Cooperation Contractors) or Pertamina, is also sold based on market prices,” he stated in a written release on Thursday (2/4/2026).

Arcandra views this condition as amplifying geopolitical risks and tightening global energy supplies. Pressures intensify when the rupiah exchange rate weakens.

The government faces a dilemma. Holding fuel prices will increase subsidy burdens. Adjusting prices will drive inflation and squeeze purchasing power.

“However, if fuel prices are adjusted to market mechanisms, the impact can be immediately felt through rising inflation and declining public purchasing power,” he said.

Prasasti’s Board of Experts member Halim Alamsyah predicts increased fiscal pressures if oil prices remain around 100 USD per barrel and the rupiah is around Rp 17,000 per USD.

“We estimate the fiscal deficit could widen to 3.3-3.5% of GDP, exceeding the 3% deficit limit that the government has maintained,” Halim stated.

Economic growth will also be pressured. In a high energy price scenario, growth is projected to fall to 4.7 to 4.9%.

“In a prolonged high oil price scenario, Indonesia’s economic growth could also slow. We estimate economic growth could drop to 4.7-4.9%, below the average growth of around 5% in recent years,” Halim explained.