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MidEast escalation could send oil prices to $100 per barrel, govt says
The government has speculated that world crude oil prices could reach US$100 per barrel as the Middle East conflict escalates.
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An Elnusa employee repairs an offshore oil and gas rig. The publicly listed company is majority owned by state oil and gas giant Pertamina. (Pertamina/Pertamina)
T
he government saw oil price reaching US$100 per barrel as plausible if conflict in the Middle East escalates further with impacts to be expected in the country’s subsidy allocation.
The Energy and Mineral Resources Ministry’s Oil and Gas Director General Tutuka Ariadji said that based on a premium risk scenario, oil prices may increase by $5 per barrel to $10 per barrel this week.
The Indonesian Crude Price (ICP), its local benchmark on energy policymaking, is expected to reflect the trend, differing by around $3 per barrel from the global benchmark.
“It is possible [for crude prices] to reach $100 [per barrel],” he said in Jakarta on Tuesday.
Read also: Govt to closely monitor economic impacts of MidEast escalation: Airlangga
He added that the ministry had requested state-owned oil and gas company Pertamina to anticipate the impact of rising global crude oil prices on the fuel oil subsidies.
Most of Indonesia’s fuel imports come from Singapore and Malaysia, he said.
