Jakarta. Energy and Mineral Resources Minister Bahlil Lahadalia pointed out an irony on Thursday: despite being an oil-producing country, Indonesia relies heavily on oil imports from Singapore, a nation that does not produce crude oil.

Indonesia’s domestic oil production stands at around 600,000 barrels per day (bpd) -- far below its total consumption of over 1 million bpd.

“We import 54 percent of our oil consumption from -- guess where -- Singapore. Our fuel supply is coming from a country that doesn’t even produce oil,” Bahlil said at the 2025 Beritasatu Economic Outlook seminar in Jakarta.

Purchasing oil from Singapore, rather than directly from Middle Eastern producers, remains the most practical solution due to proximity, trade agreements, and refinery infrastructure.

Declining Oil Production and Government’s Response
Indonesia’s oil output has been steadily declining over the past five years, dropping from 707,000 bpd in 2020 to around 600,000 bpd today. At the same time, imports have surged to nearly 1 million bpd to meet growing domestic demand.

To address this imbalance, the government has set an ambitious target to increase crude oil production to between 900,000 and 1 million bpd by 2029, aiming to restore output levels not seen since the country’s peak production era in the 1990s, when Indonesia was a key member of OPEC.

"This is an upside-down situation compared to 1997-98, when we exported 1 million bpd while domestic consumption was only 600,000 bpd," Bahlil said.

A key strategy to achieve this target is the reactivation of idle oil wells across the country, Bahlil explained.

"We have over 40,000 oil wells, but most of them are idle -- only around 16,000 wells are currently active," he said.

Earlier this week, Bahlil also announced that nearly half of Indonesia’s projected crude oil exports of approximately 28 million barrels will be redirected to the domestic refining industry as part of the country’s broader energy security strategy.

"In line with President Prabowo’s directives, we have instructed domestic refineries to absorb all available crude oil, including lower-grade output that was previously rejected, to reduce dependence on exports," he said.

Indonesia’s major refineries in Balikpapan, Cilacap, and Dumai are now capable of processing a wider range of crude oil, including lower-quality varieties. In addition, the government is fast-tracking the construction of new refineries in Tuban and Balongan to further enhance domestic refining capacity in the coming years.

As part of this initiative, up to 13 million barrels of crude oil, originally designated for export, will be redirected to local refineries to strengthen domestic fuel supply and reduce reliance on imports.

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