Oil Price Breaches US$113 Per Barrel, Purbaya Opens Door to 2026 State Budget Revision
Jakarta — Finance Minister Purbaya Yudhi Sadewa has opened the possibility of revising the structure of Indonesia’s 2026 State Budget and Expenditure (APBN) given the surge in global oil prices amid conflict between the United States and Israel against Iran.
According to him, any changes to the APBN structure will only be considered after observing oil price developments over the next month. Global oil prices have currently exceeded an average of US$113.68 per barrel, whilst the safe threshold stands at US$92 per barrel.
“We will monitor the situation over this month and see how things develop. If everything changes within a month, we will conduct a comprehensive evaluation, but we will ensure that the momentum of economic growth is not disrupted,” Purbaya said after inspecting Tanah Abang Market Block A in Central Jakarta on Monday, 9 March 2026.
He also disclosed that the Ministry of Finance has conducted a risk assessment or stress test on how oil prices might impact the APBN deficit burden. The stress test used annual average oil prices rather than daily fluctuations.
In Purbaya’s stress test scenario, if the annual average global crude oil price reaches US$92 per barrel, the APBN deficit would exceed the safe limit of 3%, rising to 3.6% of GDP.
“So it is still below that level. Therefore, we remain calm for now. Clearly, we will monitor the situation continuously and I will not delay making a decision if necessary,” Purbaya stated.
Thus far, Purbaya has observed no disruptions to domestic economic activity resulting from the oil price increase. Nevertheless, he pledged to continue monitoring the current situation closely and assured that he would not delay taking necessary decisions or implementing policies if required.
“I have not yet observed any disruption to domestic economic activity due to the high oil prices. But it has only been a short time,” Purbaya noted.
Purbaya emphasised that all parties should refrain from hastily concluding that global crude oil prices will continue to surge over the long term and affect domestic price levels.
He further stressed that daily fluctuations in global crude oil prices do not immediately disrupt government fiscal conditions, as their effects only become apparent over monthly periods.
“Therefore, everyone else, do not hastily assume or conclude that prices will remain at US$100 or even reach US$150, which would undermine our budget capacity. We will continue to assess the situation over time,” Purbaya concluded.