Rupiah Hits Rp17,926 per US Dollar Amid Rising Oil Prices

The rupiah exchange rate experienced heavy pressure against the US dollar today, 3 June 2026. According to market data, the rupiah was observed breaching the level of Rp17,926 per US dollar, driven in part by the rise in global oil prices.

Money market observer Ibrahim Assuaibi stated that this sharp depreciation is a chain reaction from escalating geopolitical tensions in the Middle East. The conflict involving Iran and Israel, alongside the deadlock in negotiations between the US and Iran, has created global uncertainty, driving the strengthening of the greenback as a safe-haven asset.

The surge in global crude oil prices is a crucial factor. Currently, WTI crude is at US$94.58 per barrel, while Brent has reached US$96.72 per barrel. This rise in energy prices risks prolonging high inflation trends in the United States, providing room for the US central bank, the Fed, to maintain high interest rate policies. Ibrahim highlighted statements from Fed official Hammack, which indicated the possibility of one more interest rate hike in 2026 if inflation does not subside.

In addition to external factors, pressure on the rupiah also stems from domestic sources. High global oil prices automatically increase the demand for US dollars to finance energy imports. Simultaneously, there is an increase in foreign exchange demand for dividend payments and maturing foreign debt obligations. Furthermore, there is a tendency for some members of the public to shift savings into foreign currency-based instruments, which further weighs on the rupiah’s position in the domestic market.

Money market observer Ibrahim Assuaibi predicts that the rupiah exchange rate could touch Rp18,000 per US dollar by next week. Efforts to stabilise the rupiah are noted to be insufficient if not accompanied by the synchronisation of fiscal and monetary policies.