Indonesia’s Finance Minister, Purbaya Yudhi Sadewa, has affirmed the robust condition of the nation’s State Budget (APBN), declaring it well-equipped to navigate the volatile global oil price landscape exacerbated by the ongoing conflict in the Middle East. This assurance comes as international crude oil prices continue their upward trajectory, now hovering around the USD 80 per barrel mark.
The current price surge presents a challenge, as the 2026 State Budget was initially formulated based on an average global crude oil price of USD 70 per barrel. However, the Indonesian government has proactively developed various contingency simulations, underscoring its commitment to safeguarding national fiscal stability against such external economic pressures.
“Oil prices are already nearing USD 80 per barrel,” Purbaya stated confidently at the Presidential Palace Complex in Jakarta on Tuesday, March 3. “I have calculated that even if prices reach USD 92 per barrel, we possess the budgetary capacity to manage it. Therefore, there is no cause for concern.” He further emphasized the government’s inherent flexibility in making necessary budget adjustments, eliminating any immediate reason for excessive apprehension.
Maximizing Revenue
Addressing potential concerns regarding a widening deficit stemming from increased import prices, Purbaya highlighted that the primary solution lies in optimizing domestic state revenue. He outlined the government’s strategic approach, explaining, “We are committed to ensuring there are no leaks in our tax collection system, which will inherently alleviate pressure on the national deficit.” He stressed that maintaining strong tax performance is crucial for effectively mitigating economic pressures arising from escalating global commodity prices.
Purbaya also offered insights into the potential for disruptions to energy distribution routes in the Middle East, particularly in the critical Strait of Hormuz. He posited that such disturbances typically result in price spikes rather than a complete cessation of supply to international markets. “It’s usually not a scenario of total supply loss,” Purbaya clarified, discussing future national energy fulfillment strategies. “We can certainly secure supplies, but at a higher cost.”
Regarding the resilience of domestic energy stocks, Purbaya reassured that the situation would remain stable as long as distribution channels function normally, even amidst price fluctuations. The Ministry of Finance’s overarching focus remains on propelling the economy forward through prudent and meticulous fiscal management, ensuring continued stability and growth for Indonesia.
Summary
Indonesia’s Finance Minister, Purbaya Yudhi Sadewa, affirmed the robust and secure condition of the State Budget (APBN), despite global crude oil prices nearing USD 80 per barrel, exceeding the 2026 APBN’s USD 70 per barrel assumption. He confidently stated that the government possesses the budgetary capacity to manage prices even up to USD 92 per barrel, utilizing contingency simulations and inherent flexibility for adjustments. This provides strong assurance amidst ongoing global oil price volatility.
To address potential deficits from increased import prices, the government plans to optimize domestic state revenue by preventing leaks in tax collection. Purbaya also clarified that disruptions in Middle Eastern energy routes usually result in price spikes, not total supply loss, allowing Indonesia to secure energy supplies at a higher cost. The Ministry of Finance remains dedicated to prudent fiscal management to drive economic growth and ensure national stability.