Our state budget macro assumption was around 70 US dollars per barrel for the ICP (Indonesian Crude Price), so we will just wait and see,
Jakarta (ANTARA) - Coordinating Minister for Economic Affairs Airlangga Hartarto said that the government will not raise the price of subsidized fuel despite a surge in global oil prices triggered by geopolitical tensions in the Middle East.

According to him, the government is still monitoring developments in the conflict and its impact on global crude prices before taking further policy measures.

“Not yet (to rise subsidized fuel price). Our state budget macro assumption was around 70 US dollars per barrel for the ICP (Indonesian Crude Price), so we will just wait and see,” he said here on Thursday.

Hartarto explained the government is currently preparing several scenarios to anticipate possible prolonged impacts from the conflict.













“How long it will last, the war could be three months, six months, or longer. So each of us is preparing scenarios,” he said.





Energy expert from Padjadjaran University Yayan Satyakti predicted global oil prices could jump to 100 US dollars per barrel from around 72 US dollars per barrel if the Strait of Hormuz is closed.

The Strait of Hormuz is a strategic sea lane linking the Persian Gulf with the Gulf of Oman, located between Oman and Iran and serving as a main route for global energy trade.

About one-fifth of global oil exports pass through this strait, including shipments from Gulf producers such as Saudi Arabia, the United Arab Emirates, Kuwait, and Iraq before reaching international markets.













Given its strategic position, Satyakti said the Strait of Hormuz remains a crucial flashpoint in tensions involving Iran, the US, and Israel.





“If Iran closes the Strait of Hormuz, oil prices could rise by 50 percent,” he said.





He added that a surge in fuel prices could affect Indonesia, which still imports part of its oil needs from the Middle East. Even without a closure of the Strait of Hormuz, the ongoing conflict could still push global oil prices up by around 10-25 percent.



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Translator: Bayu, Kenzu
Editor: M Razi Rahman
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