Indonesia to import more crude oil from US as Middle East conflict escalates, minister says
The government is monitoring the impact of higher crude oil prices on fuel subsidy spending
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[JAKARTA] Indonesia will increase crude oil imports from the US to replace some supply from the Middle East amid an escalating war in the region, its Energy Minister Bahlil Lahadalia said on Tuesday (Mar 3).
The ongoing US and Israeli air war against Iran has killed scores of civilians in Iran, Israel and Lebanon, thrown global air transport into chaos and sent oil prices surgingafter the effective closure of the Strait of Hormuz, where one-fifth of the world’s oil trade skirts the Iranian coast.
A quarter of Indonesia’s crude oil imports come from the Middle East, Bahlil said, while the region also accounts for 30 per cent of the country’s liquefied petroleum gas (LPG).
“The current scenario is that for the crude that we import from the Middle East, we will redirect to the US, so that there’s certainty of availability for us,” he said.
Two vessels owned by Pertamina, Indonesia’s state energy firm, are stuck in the Strait of Hormuz, and Indonesia is trying to use diplomatic means to get them out, Bahlil added.
A spokesperson with Pertamina said on Tuesday that the two vessels are safe, and authorities are treating the safety of its crew members and assets as a priority.
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Some imports of LPG will also be sourced from regions outside the Middle East, Bahlil said. He did not say from whom Indonesia will import.
The government is monitoring the impact of higher crude oil prices on fuel subsidy spending, Bahlil said.
Subsidised fuel price hikes are not expected thus far and supply is sufficient ahead of the Eid holidays, Bahlil said. Indonesia is the world’s largest Muslim-majority nation. REUTERS
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