Indonesia expects its average crude oil price to reach US$95 per barrel this year, Economy Minister Airlangga Hartarto said on Wednesday, well above the US$70 assumed in the state budget. He said the government was currently buying crude at around US$91-92 per barrel and expected the year-end average to be US$95.
Energy Minister Bahlil Lahadalia said the government would keep subsidised fuel prices unchanged and aimed to keep the Indonesian crude price (ICP) at or below US$100 per barrel this year. He said the average to date was US$92. Increases in the ICP automatically raise the subsidy bill, he noted.
September benchmark jumps
The Ministry of Energy set the September 2026 ICP at US$112.81 per barrel, up US$23.38, or 26 percent, from August’s average of US$89.43. The announcement was made on Monday by Director General of Oil and Gas Laode Sulaeman.
Laode said the rise reflected the dynamics of the global oil market, influenced by high geopolitical uncertainty and rising supply disruption risk. The increase occurred across all international benchmarks, he said.
Supply risks mount
Laode linked the increase to conflict and diplomatic deadlock in the Middle East involving the United States and Iran. He cited risks to shipping through the Strait of Hormuz, where crude exports fell 28 percent compared with July.
Drone attacks on energy infrastructure also weighed on supply. A Saudi East-West pipeline with capacity of 7 million barrels per day was temporarily shut after one attack. OPEC+ has delayed production quota increases, and refineries and export terminals in Russia and the Red Sea region were hit again, according to Laode.
Related: Indonesia's crude average near $91-92 as global prices top $100 · WTI crude trades above $100 a barrel, Brent touches $110
