Simulation of Rupiah at Rp17,000 and Oil Price at US$84: How Much Would the State Budget Deficit Widen?
Jakarta, CNBC Indonesia - The rupiah’s weakening beyond the Rp17,000 per US dollar level, along with a surge in global oil prices, is raising concerns about the health of the State Revenue and Expenditure Budget (APBN).
These two factors are seen as potentially widening the government’s fiscal deficit, which is kept below 3% of Gross Domestic Product (GDP).
Mohammad Faisal, Director of CORE Indonesia, explained that his organisation had previously conducted a simulation on the impact of exchange rate volatility and oil prices on the government’s fiscal position. According to him, when economic stability issues come under scrutiny, one aspect that must be monitored is fiscal governance.
“We once did a simulation when stability was in the spotlight, regarding fiscal governance,” Faisal said at the Central Banking Forum, themed ‘Indonesia’s Economic Resilience in Facing Global Exchange Rate Volatility’, in Jakarta on Monday (13/4/2026).
In the simulation, the additional burden of energy subsidies was one of the drivers of the widening deficit.
“If the oil price is US84perbarrel, orhigher, withanexchangerateofRp16, 800 − 17, 000/US, the energy subsidies needed would exceed Rp100 trillion. When presented as a percentage of GDP, it would actually breach 3%,” he said.
“Thus, fiscal governance becomes a very significant challenge and must be avoided from reaching 3%,” he added.
In his presentation, Faisal explained that the deficit widening could vary across several scenarios for global oil prices and the rupiah exchange rate against the dollar, due to global uncertainties stemming from the roles of the United States and Iran.
In a scenario where the rupiah breaches Rp17,000/US$ with oil prices at US$70-75 per barrel throughout the year, the deficit is estimated at 2.79% of GDP.
Meanwhile, for a scenario with the rupiah at Rp17,000/US$ and oil prices at US$84-90 per barrel, the deficit could widen to 3.13%.
On the other hand, the Ministry of Finance emphasised that the government is still using the Indonesian Crude Price (ICP) as the benchmark in fiscal calculations.
Noor Faisal Achmad, Director of Economic Stabilisation Strategy at the Directorate General of Fiscal Balance (DJSEF) of the Ministry of Finance, explained that based on the latest monitoring, prices are still around US$78 per barrel.
“That’s why we saw the latest monitoring still at 78, although subsequently it’s about which one to use. We still use ICP, so our communication with the Ministry of Energy and Mineral Resources, SKK Migas, this is what we use. There will certainly be adjustments with Brent and others; this is the basic assumption we use,” Noor Faisal said at the Central Banking Forum, themed ‘Indonesia’s Economic Resilience in Facing Global Exchange Rate Volatility’, in Jakarta on Monday (13/4/2026).
He added that the government remains open to adjustments if global oil price developments deviate significantly from initial assumptions.
“But if there is any later, yes, there will certainly be adjustments. Although specifics were mentioned earlier, we might review later how the impact is,” he said.