Indonesian subsidized fuel and liquefied petroleum gas prices will remain frozen through the end of 2026, according to Energy and Mineral Resources Minister Bahlil Lahadalia. The pricing stability policy, announced following directives from President Prabowo Subianto, aims to insulate domestic consumers from global energy market volatility and currency fluctuations.
According to Energy and Mineral Resources Minister Bahlil Lahadalia, the decision to hold prices steady follows President Prabowo Subianto’s recent visits to Russia and France. Bahlil stated that national energy stocks currently sit above minimum required standards across diesel, gasoline, and liquefied petroleum gas.
From a fiscal standpoint, the government considers the price freeze manageable because the Indonesian Crude Price remains below current budget assumptions. Bahlil noted that while the budget accounts for higher figures, the average Indonesian Crude Price from January onward has stayed no more than US$77 per barrel, leaving a fiscal margin of about US$7.
Indonesia relies on imports of roughly 1 million barrels of oil per day to meet domestic consumption levels of 1.6 million barrels daily, while domestic production sits between 600,000 and 610,000 barrels per day, according to Ministry data.
PT Pertamina Patra Niaga confirmed that it will enforce the state directive to keep retail rates steady. Kitty Andhora, VP Corporate Communication of Pertamina Patra Niaga, stated that the distributor adheres strictly to government policy despite ongoing shifts in world oil prices and rupiah exchange rates.
Retail Rules for Subsidized Versus Unsubsidized Fuel
While subsidized fuel prices are locked through 2026, unsubsidized fuel retail prices continue to float based on established government formulas. According to Pertamina Patra Niaga, unsubsidized pricing adjusts automatically to reflect shifts in international crude markets and currency exchange rates.
Expanding Energy Cooperation with Russia
To bolster long-term energy security, the Indonesian government remains open to expanding energy cooperation with Russia. Minister Bahlil indicated that discussions involve crude oil supplies alongside infrastructure investments, including refineries and energy storage facilities.
Bahlil stated that certain Russian investments have gained traction and are nearing execution, pending final rounds of technical discussions regarding storage and refining capacity.
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