State Budget Still Withstands Shocks As Long as Oil Prices Do Not Exceed US$75

Jakarta — CNBC Indonesia reports that the Ministry of Finance has conducted a stress test to assess how geopolitical turmoil from the Iran–United States–Israel conflict in the Middle East could affect global crude oil prices. Deputy Finance Minister Juda Agung said the results show the State Budget (APBN) can still withstand price volatility up to US$75 per barrel.

‘In the current situation, we see a foreseeable future. For example, if oil prices are currently around US$70–72, that is still in line with our APBN,’ Juda Agung said at the Indonesia Economic Forum 2026 in Jakarta earlier this week, quoted on Wednesday (4 February 2026).

‘If it rises to US$75, in our scenario it would still fall within the APBN range. Both the deficit side and growth would be unaffected,’ he asserted.

However, above that level, he conceded the APBN would face substantial pressure. Moreover, Juda argued that no fiscal framework anywhere is designed to respond to price pressures up to US$100–150 per barrel. ‘If oil prices rise above US$100–150, well, of course the impact would be significant. There is no fiscal design that can cover such an extreme scenario. Certainly, the effect on the APBN would be quite substantial,’ he said.

As is known, the APBN already bears a significant portion of government expenditure for fuel subsidies. In Presidential Regulation (Perpres) No. 118 of 2025 on the Detailed Budget of State Revenue and Expenditure for Fiscal Year 2026, the subsidy expenditure for fuels and energy prepared in the Budget Section of the State General Treasury (BA BUN) amounts to Rp 210.06 trillion. That figure is higher than the 2025 allocation of Rp 203.41 trillion.

Juda Agung said that every US$1 increase in Indonesian Crude Price (ICP) could widen the deficit by around Rp 6.8 trillion. ‘Actually, in our financial notes there is already a sensitivity analysis. A one-dollar rise in ICP would cause an increase in the deficit of Rp 6.8 trillion,’ he said.

Citing Refinitiv on Wednesday (4 March 2026), the price of West Texas Intermediate (WTI) crude reached US$75.05 per barrel. Meanwhile, Brent crude rose to US$82.15 per barrel.