Purbaya's Strategy to Safeguard the MBG Programme from Global Oil Price Rises

Finance Minister Purbaya Yudhi Sadewa is monitoring the rise in global oil prices which could affect the budget for the Makan Bergizi Gratis (MBG) programme. The increase in world oil prices puts pressure on the State Budget (APBN), with knock-on effects to various budget items, including MBG. The pressure from rising oil prices could lead to a larger deficit. One option being considered by Purbaya is to make MBG more efficient, with reductions in line items that do not directly relate to the operational preparation of meals.

The government is planning mitigations related to the oil price rise. A similar episode in the past when world oil prices breached US$150 per barrel provides a reference.

‘At that time the economy did slow, but it did not collapse. We have experience in dealing with situations like that,’ he said.

He noted that the Indonesian economy could be affected by higher oil prices. ‘Our economy could also be affected if oil prices suddenly rise, gradually up to US$100. At present it’s around US$78. And we had assumed US$70 in our APBN,’ he explained on his official Instagram account @luhut.pandjaitan, on Thursday (5 March 2026).

‘That is, the Strait of Hormuz has an influence; how significant is it? How many days of our strategic oil and energy reserves? If this is shut, what then? So contingency plans must be prepared,’ he added.

Not only that, Luhut formulated recommendations to the government on this matter because rising oil prices directly affect the APBN. ‘From now on we must look at from where we should import oil, what the costs are? What is the difference? What is the impact on the APBN? We are also holding open discussions in the Economic Council,’ he said.

Transport and logistics costs must be scrutinised so that the oil import strategy operates as it should.