Pertamax Fuel Prices Likely to Drop Through Year-End, Experts Say

The price of Pertamax, a non-subsidized fuel in Indonesia, is likely to see a gradual decrease throughout the remainder of 2026, according to energy economist Yayan Satyaki from Padjadjaran University.

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There's room for lowering non-subsidized fuel prices. Dexlite and Pertamina Dex have already been reduced.

Yayan projects the fuel's price to drop from Rp16,250 per liter in June to between Rp12,100 and Rp13,500 per liter by December. He forecasts a steady decline month-by-month, reaching Rp13,479 per liter by year-end. This forecast is based on anticipated reductions in the Indonesian crude price (ICP) to US$90.6 per barrel and a strengthening exchange rate from Rp17,927 to Rp16,959 against the US dollar by December.

Global crude oil prices, influenced by geopolitical dynamics such as the conflict between the United States, Israel, and Iran, play a significant role in determining the ICP. Yayan noted a recent fluctuation where Brent crude oil prices briefly hit US$117 per barrel before correcting, influenced by a U.S.-Iran peace agreement that was later overshadowed by renewed Israeli attacks on Lebanon and the cancellation of U.S.-Iran negotiations. These events caused oil prices to rise again above US$80 per barrel.

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My recommendation is that the government prepares a scenario simulation, for example, with an ICP of US$70–90 per barrel, because the regime uncertainty is much greater than the usual statistical error.

Despite the potential for price volatility, Yayan believes Indonesia's fiscal position is robust enough to handle disruptions, even if the Strait of Hormuz were to close. He pointed to the government's surplus budget balance (SAL) of approximately Rp420 trillion and a manageable deficit. Even with an ICP of US$100 per barrel, which would widen the deficit significantly, the SAL would still provide coverage, albeit as a one-time buffer rather than a structural solution.

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This means that the Rp420 trillion SAL still covers the scenario of a re-closure without spending cuts, but as a one-time insurance policy, not a structural solution.