Indonesia is preparing contingency measures to manage rising global oil prices and potential supply disruptions as conflict between Iran, Israel and the United States escalates, with officials warning that the war could put pressure on the state budget and energy supply. 

The conflict has pushed global crude prices sharply higher and raised fears of disruptions to oil shipments through the Strait of Hormuz, a strategic corridor that carries roughly one-fifth of global oil trade. 

According to The Jakarta Post, Brent crude surpassed USD 85 per barrel, far above the USD 70 per barrel assumption used in Indonesia’s 2026 state budget, increasing concerns over fiscal stability. Analysts warn prices could reach USD 100 per barrel if the conflict worsens or shipping flows are disrupted. 

Finance Minister Purbaya Yudhi Sadewa said the government has already prepared scenarios to manage the fiscal impact. 

“I’ve run the numbers—even if crude oil hits 92 dollars per barrel, we can still manage the budget. So there’s no problem,” he said, as quoted by Antara News. 

Purbaya noted that the first impacts of the conflict would likely be seen in export dynamics and global oil prices, but stressed that Indonesia’s economy remains resilient because domestic demand accounts for around 90 percent of GDP. 

However, higher oil prices could still increase pressure on public finances. 

In an interview with Reuters, Purbaya said that if crude oil prices rise to around USD 90-92 per barrel, the state budget deficit could widen to 3.6 percent of GDP if the government does not adjust spending. 

“Of course, we’ll cut expenditure that creates the least impact to the economy,” Purbaya told Reuters, adding that the ministry has already prepared contingency plans to keep the deficit below the legal 3 percent ceiling. 

Energy supply disruptions are another concern as tensions escalate around the Strait of Hormuz. 

Energy and Mineral Resources Minister Bahlil Lahadalia said Indonesia plans to shift part of its crude oil imports away from the Middle East to secure supply. 

“The current scenario is that for the crude that we import from the Middle East, we will redirect to the United States, so that there’s certainty of availability for us,” Bahlil said, as quoted by Reuters. 

About 25% of Indonesia’s crude imports come from the Middle East, while the region also supplies 30% of the country’s liquefied petroleum gas (LPG) imports, according to the energy ministry. 

The conflict has already disrupted shipping routes. Two tankers belonging to Pertamina International Shipping are currently stuck in the Persian Gulf as regional tensions escalate. 

Energy Minister Bahlil said Jakarta is pursuing diplomatic efforts to free the vessels and has prepared alternative supply options. 

“We have already secured this alternative. So [the stranded tankers] can be a problem, but it is not a substantial one,” Bahlil said, as quoted by the Jakarta Globe. 

At the same time, the government is moving to strengthen energy security by expanding national fuel reserves. 

Indonesia’s energy reserves currently cover only about 25–26 days of domestic demand, highlighting vulnerabilities to global supply shocks, Bahlil said. 

“The government is now working to build storage with capacity reaching up to three months,” he said. 

Higher oil prices could also increase the government’s subsidy burden, since Indonesia continues to subsidize fuel for consumers. 

According to energy analysts cited by The Jakarta Post, every USD 1 increase in global oil prices could add roughly IDR 7 trillion (USD 414 million) to Indonesia’s fuel subsidy costs. 

Despite these risks, officials say the government remains confident it can manage the economic impact while ensuring domestic fuel availability. 

“We must be very cautious in calculating everything, while ensuring domestic fuel availability to provide certainty and service to our people,” Bahlil said.