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View all search resultsBudget can weather $100 crude amid renewed Iran tensions, govt says
Brent crude, the global oil benchmark, slipped to $104.77 a barrel on Friday after hitting $108 on Thursday, its highest level since May 19 and its biggest one-day jump in six weeks.
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Oily business: Chevron Indonesia Company operates an offshore platform in Sepinggan field in the Makassar Strait, 37 kilometers east of Balikpapan, East Kalimantan, on April 23, 2019. Oil and gas will likely remain strategic for Indonesia despite the global commitment to net-zero emissions. (JP/Novi Adri)
T
he government said it could keep subsidized fuel prices unchanged and absorb higher energy costs as oil topped US$100 a barrel this week, amid fears that renewed fighting around the Strait of Hormuz and Red Sea could prolong supply disruptions.
Brent Crude, the global oil benchmark, slipped to $104.77 a barrel on Friday after hitting $108 on Thursday, its highest level since May 19 and its biggest one-day jump in six weeks.
Finance Minister Purbaya Yudhi Sadewa said on Thursday that the state budget “still had enough room” to withstand higher oil prices and that the government had no plans to increase its energy subsidy allocation despite the surge in global crude prices.
Read also: Currency markets subdued as oil shock lifts global yields
Fiscal calculations had taken into account oil prices of around $100 a barrel, while the 2026 budget deficit was targeted at 2.85 percent of gross domestic product, he said.
"We have experienced this before, so no need to worry too much. We will manage our budget to remain sustainable, with the deficit kept below 3 percent,” Purbaya said.
Energy and Mineral Resources Minister Bahlil Lahadalia said on Friday that the government would not raise subsidized fuel prices, including Pertalite gasoline and Biosolar diesel, amid soaring global oil prices.
