Indonesia shifts crude, fuel and LPG imports to government-led deals

JAKARTA, Oct 26 — Indonesia has changed how it buys crude oil, fuel and liquefied petroleum gas (LPG) abroad, replacing tenders between business entities with direct government-to-government (G2G) and government-to-business (G2B) deals under Presidential Regulation (Perpres) No. 107 of 2026, the Ministry of Energy and Mineral Resources (ESDM) said.

Under the regulation, signed by President Prabowo Subianto, the state negotiates directly with supplier countries, procurement is carried out by a government-assigned public service agency (BLU), and Pertamina buys from the BLU, the ministry said. Pertamina may still import directly when national reserves are very thin or when geopolitical disruption hits source countries, in coordination with the BLU.

Energy Minister Bahlil Lahadalia said Pertamina's tenders took a long time, and that in some cases the company lost supply after winning at low prices because supplier countries chose buyers willing to pay more. About 80% of Indonesia's LPG needs are imported from the United States, according to the ministry. Bahlil is scheduled to travel to countries including India and China to secure supply and has been tasked with seeking long-term supply contracts.