Analysts: U.S. Trade Pressure Likely Behind Indonesia's Plan to Slash Singapore Fuel Imports

TEMPO.CO, Jakarta - Several energy analysts have responded to the government's plan to slash fuel imports from Singapore. Mulyanto, the head of the Indonesian Society of Scientists and Technologists (MITI), for example, suspects that the plan is a consequence of the tariff talks underway between the United States and Indonesia. 

The Indonesian government previously signaled its intention to boost oil and gas imports from the U.S. "I believe the imports won't be diverted to the Middle East but to America, which lines up with the logic of reciprocity," he said in a written statement on Wednesday, May 14, 2025.

Hence, he said, phasing out oil and gas imports from existing importers would be a logical consequence of that. Mulyanto, who was a member of the House Energy Commission for the 2019-2024 period, urged the government to carefully consider the plan from both technical and economic standpoints.

"The increase in oil and gas imports from the United States should not lead to dependency, especially for subsidized 3-kilogram LPG gas," said Mulyanto.

Earlier, Energy and Mineral Resources Minister Bahlil Lahadalia announced the plan to stop oil imports from Singapore on Thursday, May 8, 2025.

At the time, Bahlil stated that 54 percent of Indonesia's oil imports come from Singapore. He added, "Singapore is a country that doesn't have oil, but we buy from there."

Bahlil also compared the price of oil purchased from Singapore to that of the Middle East, alluding to the plan to divert oil purchases to Middle Eastern countries. "I said, it's more dignified that we get oil from the Middle East," said the Golkar Party chair.

Echoing Mulyanto's statement, Fahmy Radhi, an Energy Economics Lecturer at Gadjah Mada University (UGM), believed that the plan is a result of U.S. trade pressure, particularly during the Trump-era government.

He said the U.S. is aiming to reduce the trade deficit with Indonesia. "Since it's not possible for us to import cars or manufactured products, oil becomes the target," Fahmy said when contacted on Monday, May 12, 2025.

However, Fahmy believes that the plan to discontinue oil imports from Singapore is not an economically rational decision and could  potentially harm Indonesia. It also overlooks the reality of supply chains and energy efficiency.

He explained that Singapore fuel has undergone a blending process to meet domestic needs, especially the likes of Pertalite that are not sold in the global market. "Imports from the U.S. or other countries may not meet such specifications, especially with the higher shipping costs," said Fahmy.

Hendrik Yaputra and Nandito Putra contributed to the writing of this article.

Editor’s Choice: Indonesia Looks to Middle East for Oil, Citing 'Dignity' Over Singapore Imports

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