Rupiah sentiment influenced by IEA plans to release oil reserves

Jakarta – Permata Bank’s chief economist Josua Pardede stated that sentiment towards the rupiah is being influenced by the International Energy Agency (IEA) announcement regarding the release of emergency oil reserves amid regional conflict.

“The statement has only exerted mild downward pressure on global oil prices during the Asian trading session,” he told Antara news agency in Jakarta on Thursday.

The rupiah exchange rate opened stronger on Thursday morning, gaining 2 points or 0.01 per cent to Rp16,884 per US dollar from the previous close of Rp16,886 per US dollar.

According to Kyodo news agency, the United States announced it would release 172 million barrels of crude oil from its emergency reserves starting the following week in an effort to lower surging energy prices resulting from escalating regional tensions.

This volume forms part of a coordinated 400 million barrel release from 32 IEA member nations announced on Tuesday (10 March). The US strategic oil reserve drawdown is estimated to take approximately 120 days.

The collective action under the IEA represents the first such coordinated release since 2022, when Russia launched its major invasion of Ukraine.

The release of 400 million barrels from the emergency reserves of 32 countries – including many European nations as well as Japan and South Korea – sets the largest precedent on record.

According to Pardede, other sentiment stems from the release of the US Consumer Price Index (CPI) for February 2026, which increased by 0.3 per cent month-on-month (mom), up from the previous 0.2 per cent mom and matching market expectations of 0.3 per cent mom.

On an annual basis, core inflation in February 2026 remained stable at 2.4 per cent year-on-year (yoy), whilst core inflation also remained unchanged at 2.5 per cent yoy.

“Nevertheless, investors remain concerned that the recent surge in oil prices could trigger inflation in March 2026, potentially pushing it above 3 per cent and constraining the Federal Reserve’s interest rate reduction plans,” Pardede said.

Based on these factors, the rupiah is expected to trade in a range of Rp16,825–Rp16,950 per US dollar.