Rupiah Closes Weaker by 24 Points Under Pressure from Oil Prices and Iran-Israel Conflict
The Indonesian rupiah weakened against the US dollar during Monday afternoon trading (9 March 2026). External pressure from surging global oil prices and escalating geopolitical conflict in the Middle East emerged as the primary factors pressuring the nation’s currency.
The rupiah closed weaker by 24 points at 16,949 per US dollar compared to the previous close of 16,925 per US dollar. During daily transactions, the rupiah even faced pressure of up to 70 points.
Money market observer Ibrahim Assuaibi stated that the rupiah’s current movement is heavily influenced by global sentiment. Global oil prices have reached around US$92 per barrel, the highest level since 2020.
This surge was triggered by Israeli and American air strikes targeting Iranian oil facilities. In retaliation, Tehran launched missile strikes on several energy facilities in the region. Additionally, threats of disruption in the Strait of Hormuz, which channels 20 percent of the world’s oil supply, have heightened market concerns.
“If oil prices continue to soar, approaching or even exceeding US$100 per barrel, the impact would be catastrophic for national finances. The budget deficit against GDP could rise to nearly 4 percent,” Ibrahim stated in his remarks in Jakarta on Monday (9 March).
Current oil price conditions have far exceeded the macroeconomic assumptions in the 2026 state budget, which were pegged at US$70 per barrel. Ibrahim estimates that this price difference could potentially increase the state budget deficit by up to Rp6.8 trillion.
On another front, the succession of leadership in Iran has also drawn attention. The appointment of Mojtaba Khamenei to replace Ali Khamenei as Supreme Leader indicates that the hardline faction remains in control in Tehran, one week after the conflict with the United States and Israel escalated.
To maintain domestic economic stability against global shocks, Ibrahim has recommended the government implement the following strategic measures.
For Tuesday’s trading, the rupiah exchange rate is predicted to remain volatile. Ibrahim projects that the rupiah could close weaker again in the range of 16,950 to 17,000 per US dollar.