Purbaya Admits Managing State Budget is Becoming Increasingly Difficult Due to High Oil Prices
Jakarta, CNBC Indonesia - Finance Minister Purbability Yudhi Sadewa has revealed that the continuous rise in global oil prices is making the management of the State Budget (APBN) increasingly difficult.
According to him, this challenge has influenced the government’s decision to optimise the allocation of the Regional Transfer Fund (TKD), even though the commitment remains to ensure that regional government operations continue to function.
“Our challenges are very heavy; we are facing global uncertainty where world oil prices are extremely high,” said Purbaya during a working meeting with Committee IV of the Regional Representative Council (DPD) in Jakarta, as reported on Monday (14/09/2026).
Therefore, he emphasised that the government is currently optimising state expenditure towards spending that provides a direct impact on the public economy.
Purbaya ensured that amidst these significant challenges, the government will continue to keep the APBN deficit below the safe limit of 3% of Gross Domestic Product (GDP) as stipulated by the State Finance Law.
“So, I must optimise it, to ensure the budget deficit does not exceed 3% of GDP, while ensuring that the primary functions of regional governments can still operate,” he explained.
Purbaya mentioned that the central government actually intends to continue increasing the TKD budget as in previous years. However, he stressed that maintaining the central government’s fiscal stability is currently of utmost importance.
“Before I took office, the TKD was reduced by Rp 200 trillion, if I am not mistaken, compared to the previous year. But I immediately added Rp 45 trillion, and I added another Rp 20 trillion in August. So, we will try to continue increasing it gradually, but we will constantly monitor our budgetary capacity,” said Purbaya.
As is known, global oil prices surged during trading on Sunday (13/09/2026) after Saudi Arabia closed a major oil pipeline connecting oil-producing regions in the Persian Gulf to export terminals in the Red Sea.
The closure has heightened market concerns regarding global oil supply disruptions amidst the conflict between Iran and the United States, as well as security uncertainties in the Strait of Hormuz.
Quoting CNBC International on Monday (14/09/2026), US West Texas Intermediate (WTI) crude oil contracts rose by 2.8% to US$102.87 per barrel at 18:27 local time. Meanwhile, Brent crude, the international benchmark, strengthened by 3.1% to US$107.87 per barrel.
The rise in oil prices occurred following drone attacks launched from Iraq that damaged Saudi Arabia’s East-West oil pipeline on Thursday (10/09/2026). The Saudi Arabian government subsequently closed the strategic pipeline.
To date, Riyadh has not disclosed the extent of the pipeline damage or how long the closure is expected to last.