Jakarta. Indonesia applauds the tentative peace deal by the US and Iran, but Jakarta prefers to wait until the warring countries shake hands on the agreement before adjusting its energy policies.

US President Donald Trump and Iran have just declared that they have reached a deal to end over three months of war. The accord is slated for formal signing in Geneva this Friday. Indonesia’s Foreign Ministry wrote that Jakarta “welcomes” the announcement.

“[This is] a positive development towards peaceful settlement of conflict and advancing peace, security, and stability in the region,” the ministry wrote on its social media account on Monday.

Jakarta calls everyone to “uphold their commitments and engage constructively in dialogue” to keep up the momentum. 

The deal is expected to restore traffic in the long-blocked Strait of Hormuz, which handles over a quarter of global seaborne oil trade, thereby easing the global energy shocks and possibly strengthening the free-falling rupiah.

Indonesia had launched some emergency policies to mitigate the war-induced energy crunch, including cutting non-essential state spending and mandating government staff to work from home every Friday to save fuel use. Most recently, the state-run energy giant Pertamina has raised the non-subsidized fuel Pertamax prices by around 32%.

Asked whether Jakarta will make changes to its policies, senior economic minister Airlangga Hartarto said that the government would be in a wait-and-see mode for now.

“We will keep an eye on the situation. Crude prices indeed have dropped to $83 per barrel. But all these [uncertainties] will end only after the agreement is signed,” Airlangga told the press shortly after closed-door talks with the sovereign fund Danantara. 

“We will remain conservative until the signing takes place. We shall wait until then.”

Global crude benchmark Brent has cooled to roughly $83 per barrel on Monday following the imminent ceasefire. This marks a huge drop, as crude prices had consistently pierced the $ 100-per-barrel barrier throughout the war.

The conflict began on Feb. 28, when the US and Israel launched surprise airstrikes on Tehran that killed the Iranian leadership.

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