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View all search resultsGovt to hike imports to meet subsidized gasoline demand
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Motorcyclists queue to refuel at a gas station in Denpasar amid a fuel supply shortage in Bali on Oct. 14, 2026. (AFP/Sonny Tumbelaka)
T
he government has announced a plan to hike fuel imports as demand for subsidized gasoline is higher than expected, but it is looking to do so without adding strain to the state budget.
Coordinating Downstream and Energy Transition Minister Bahlil Lahadalia said in a press briefing on Monday that the market price of crude had averaged beyond the figure set in the state budget, and therefore “additional subsidies and compensation will certainly happen”.
Despite being a net oil importer as domestic production is too little to meet demand, Indonesia subsidizes the two most widely consumed fuel types in the country, gasoline brand Pertalite and diesel brand Solar, both sold by state-owned oil and gas company Pertamina.
Both are subject to nationwide annual volume quotas, with the government covering the gap between market and administered prices through direct subsidies and compensation to Pertamina.
Pertalite reserves now stand at only 18 days, revealed the minister, who had noted on a separate occasion on Friday that demand for the gasoline had recently spiked due to price increases of unsubsidized fuels.
In response, the government plans to increase the quota for Pertalite, necessitating higher gasoline imports than initially planned.
Asked on Monday at an event in Jakarta whether he was already involved in the talks on the quota hike, Finance Minister Suahasil Nazara replied, “write what [I talked about] earlier first; we’ve talked a lot”, referring to his panel session about economic growth.
