Jakarta. Indonesia’s Finance Minister Purbaya Yudhi Sadewa said Monday that the recent surge in global oil prices could increase the government’s energy subsidy burden but assured that the country’s fiscal management remains under control.

Global crude prices have recently climbed to around $114 per barrel, far above the $70 per barrel oil price assumption used in Indonesia’s state budget.

Purbaya acknowledged that sustained high prices could affect subsidy spending but said the government assesses oil prices based on their annual average, rather than short-term fluctuations.

He noted that oil prices could still fall later in the year, potentially bringing the overall annual average closer to the government’s initial assumption.

“For example, if prices reach around $100 per barrel but later fall to about $50, the annual average could still align with the earlier assumption,” Purbaya said.

The minister urged policymakers and the public not to react too quickly to temporary price spikes.

“So we should not rush into decisions. We need to observe how conditions develop. After a month we can better predict where prices are heading and then take the appropriate policy measures,” he said.

Purbaya stressed that the government has sufficient policy tools to adjust fiscal measures without disrupting Indonesia’s economic growth momentum. He added that Indonesia has experienced several periods of high oil prices in the past and has managed to maintain economic stability through careful policy adjustments.

“Trust that we know how to handle this. Our country has gone through periods of high oil prices before, and it did not collapse because the policies were appropriate,” Purbaya said.

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