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Indonesia's Budget Strained by Soaring Oil Prices

3/20/2026

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Story summary
  • Indonesia faces a fiscal challenge as global oil prices exceed US$100 per barrel, straining its fuel subsidy budget of 25.1 trillion rupiah.
  • Experts urge reconsidering the free nutritious meals programme (MBG), which costs 335 trillion rupiah and accounts for 11% of the national budget.
  • Economists say energy subsidies should be prioritized to curb inflation and economic downturn.
  • The government must balance competing needs amid rising energy costs and political pressures.