Purbaya Allocates Additional Rp100 Trillion for Fuel Subsidies, State Budget Deficit Forecast at 2.9%
Finance Minister Purbaya Yudhi Sadewa has stated that the government has prepared an additional budget for fuel subsidies to PT Pertamina (Persero). The aim is to address the potential volatility in global oil prices, while keeping domestic selling prices unchanged.
As is known, global crude oil prices are currently fluctuating around the upper range of US$100 per barrel, well above the 2026 state budget assumption of US$70 per barrel. However, the government confirmed yesterday that there will be no changes to domestic fuel selling prices for the time being.
Purbaya explained that the additional budget prepared is in the range of Rp90 trillion to Rp100 trillion until the end of 2026. This fuel subsidy budget is separate from the energy subsidy and compensation allocation in the 2026 state budget, which totals Rp381.3 trillion.
“Rp90 trillion to Rp100 trillion, that’s the subsidy; the compensation is calculated separately,” said Purbaya when met at Wisma Danantara, Jakarta, on Wednesday (1/4/2026).
He stated that this figure means the government now anticipates the 2026 state budget deficit to rise from the target of 2.68% to 2.9% of gross domestic product (GDP), considering the assumption of global crude oil prices at US$100 per barrel until the end of 2026.
“We are approaching this with the mindset that oil prices will remain high at an average of US$100 throughout the year. We are implementing policies to keep the deficit controlled at 2.9%,” he explained.
Nevertheless, Purbaya emphasised that, for the time being, the unchanged fuel prices will not deplete the energy subsidy and compensation budget in the 2026 state budget.
He said that, temporarily, the unchanged fuel prices are being fully covered by PT Pertamina (Persero). “For now, it seems Pertamina is handling it, temporarily,” said Purbaya.
Purbaya explained that Pertamina’s liquidity now has more room to face oil price pressures because the government has accelerated payments for outstanding subsidy and compensation claims.
“It can manage because government payments are now smooth, and we pay 70% of the compensation every month continuously,” revealed Purbaya. “So Pertamina’s finances are very good; absorbing it for a short period is no problem,” he stressed.