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View all search resultsThe government is pursuing a two-pronged strategy to strengthen energy security: reducing dependence on fuel imports through the mandatory B50 biodiesel policy while reforming fuel subsidies to make them more targeted toward lower-income households. Both policies, however, come with challenges. The B50 program, which combines 50 percent palm oil-based biofuel with 50 percent fossil-fuel diesel, could increase domestic demand for crude palm oil (CPO), potentially affecting exports and cooking oil prices. Meanwhile, the government’s planned restrictions on subsidized fuel purchases have raised questions about the accuracy of household welfare assessments used to determine eligibility.
The arrest of 142 suspects by South Sumatra Police has brought renewed attention to what authorities describe as one of the largest fuel embezzlement cases in the country’s recent history. Between January and July 2026, police uncovered 96 cases involving the diversion and illegal trade of subsidized fuel, with an estimated 1.4 million liters of fuel allegedly siphoned from the official distribution system.
Cost is the major challenge facing the government's hydrogen vehicle ambition, primarily stemming from a need to develop systems that can produce cheap green hydrogen and the stark affordability of battery electric vehicles today.
In Langkat regency, lines stretched about 13 kilometers from a gas station in Wampu to another in Tanjung Pura, trapping thousands of private cars, intercity buses and logistics trucks for hours. Some vehicles broke down after running out of fuel while waiting in line.
Suprianto, a diesel truck driver from Pagar Marbau district, Deli Serdang regency, said he was forced to spend the night inside his truck at a fuel station on Jalan Galang in Lubuk Pakam while waiting for diesel supplies to arrive.
The government has finally green-lit the price increase for Pertamax, the widely used nonsubsidized gasoline with research octane number (RON) 92, after months of attempting to shield consumers from rising global oil prices triggered by the United States-Israeli war on Iran, particularly disruptions due to closure of the Strait of Hormuz. While the move is expected to ease pressure on public finances, it also creates new risks such as consumers shifting to subsidized fuels, increasing the government's subsidy burden.
In North Sumatra’s capital Medan, hundreds of ojol (online motorcycle transportation) drivers protested outside Pertamina's office on Thursday, demanding a solution to fuel shortages that have led to long queues at gas stations across the city.
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