Rising Oil Prices and What It Means for Us

 By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The recent 3 percent increase in global oil prices, driven by tensions between Iran and the Amerika Serikat, highlights how unstable the global situation currently is. While a 3 percent rise may seem small at first glance, its impact can be significant—especially for countries that still rely on imported oil, such as Indonesia.

This increase is not only caused by actual disruptions in oil supply, but also by market concerns. Whenever tensions rise in the Middle East, global markets tend to react quickly. There is a strong fear that key oil distribution routes could be disrupted, particularly the Selat Hormuz, one of the most important oil shipping lanes in the world. If this route were to be blocked or disturbed, global oil supply could drop sharply, pushing prices even higher.

This situation shows that oil prices are heavily influenced by political conditions, not just economic factors. As long as the world remains dependent on oil, conflicts in certain regions will continue to have wide-reaching effects. Even relatively small tensions can trigger immediate price increases.

For Indonesia, this is a situation that requires serious attention. As a country that still imports a portion of its oil needs, rising global prices will be felt directly. The government may face increased pressure to keep fuel prices stable. Otherwise, higher fuel prices could lead to broader increases in the cost of goods and services.

The impact does not stop there. Rising oil prices usually lead to higher transportation costs. When transportation becomes more expensive, the prices of basic goods often follow. In the end, it is the public—especially lower- and middle-income groups—who bear the greatest burden.

This pattern is not new. Almost every time there is conflict in the Middle East, oil prices rise. This reflects a deeper issue: the global energy system still depends heavily on regions that are politically unstable. This dependency makes the global economy vulnerable.

Therefore, this situation should serve as an important reminder for Indonesia. The country cannot continue to rely heavily on imported oil. Concrete steps are needed to reduce this dependence, such as developing alternative energy sources like solar, wind, and geothermal power.

In addition, improving energy efficiency is just as important. People can start with simple actions, such as reducing the use of private vehicles or using energy more wisely. Lower consumption can help reduce the impact of global price increases.

From the government’s side, energy policies need to be more forward-looking and decisive. It is not enough to respond only when prices rise; there must be long-term strategies to minimize future risks.

In conclusion, the rise in oil prices is not just a routine economic issue. It is a signal of global uncertainty that directly affects countries like Indonesia. Without proper anticipation and action, the impact could become more severe. That is why both the government and society need to adapt and work toward reducing dependence on unpredictable global conditions.

By : K&Co - April 22, 2026

Refusing Debt Is Bold, but Caution Still Matters

By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The decision by Purbaya Yudhi Sadewa to reject loan offers from the International Monetary Fund (IMF) and the World Bank has drawn attention. The government argues that Indonesia’s fiscal condition is still strong, so there is no urgent need to take on additional debt.

At a basic level, this decision sounds positive. It suggests that Indonesia is still capable of funding its needs without relying on foreign loans. This can be seen as a sign that the country’s financial situation is stable, even as global conditions remain uncertain.

Refusing debt can also be a wise move. Loans are never truly free—they must be repaid, often with interest. If the funds are not urgently needed, taking on new debt could simply create a heavier burden in the future. By declining these offers, the government is trying to keep the country’s finances under control.

This decision may also boost national confidence. Indonesia appears to be signaling that it does not always need support from international institutions like the IMF or World Bank. This is important, especially considering that in the past, many countries faced serious problems due to excessive reliance on foreign debt.

However, this decision should also be viewed with caution. The global economic situation is still unstable. Many factors can change quickly, such as geopolitical conflicts, rising energy prices, or a slowdown in the global economy.

Even if Indonesia’s fiscal condition is currently strong, it may not remain that way forever. In the event of a major crisis, government spending needs could rise suddenly. In such situations, external financing—including loans—can become an important tool to maintain economic stability.

This is where balance becomes crucial. Refusing debt is reasonable, but it should not mean closing all options. The government still needs to prepare backup plans in case conditions worsen. Being confident is good, but overconfidence can be risky if it leads to delayed responses during a crisis.

More importantly, the issue is not just about accepting or rejecting debt, but about how well the country manages its finances. If government spending is efficient and well-targeted, the need for borrowing can be minimized. On the other hand, poor financial management can turn even small amounts of debt into serious problems.

Looking ahead, the government should also focus on strengthening state revenue, such as through taxation and economic growth. This would help reduce dependence on borrowing in the long term. In conclusion, rejecting loan offers from the IMF and World Bank is a bold and generally positive step. However, given the uncertainty of the global situation, caution remains essential. Confidence is important, but it must be supported by careful planning and responsible financial management. 

By : K&Co - April 22, 2026

Indonesia Needs More Than Just Alternative Oil Imports

 By Kusnandar & Co., Attorneys At Law – Jakarta, Indonesia

The Indonesian government’s move to prepare alternative sources of oil imports amid the Middle East conflict is understandable and important. The Strait of Hormuz, a strategic global oil route, has always been a potential flashpoint. Any tension in this region can disrupt global oil supply and trigger domestic energy price surges. Redirecting some imports to countries like the United States or Brazil may reduce short-term risk, but this approach remains reactive rather than a long-term strategic solution.

Approximately 20–25% of Indonesia’s oil imports come from the Middle East. Even a brief disruption in supply from this region can significantly impact the national economy. Indonesia’s energy dependence is further compounded by limited domestic reserves, sufficient for only about three weeks of consumption. In other words, the country is teetering on a thin line between energy stability and a potential sudden crisis.

While diversifying import sources is crucial, it merely mitigates risk temporarily. Shifting reliance from one region to another does not address the underlying problem: Indonesia is still heavily dependent on imported fossil fuels. This strategy may also create new challenges, such as higher logistics costs and longer delivery times, which are ultimately passed on to consumers.

This situation should serve as a stark warning: energy resilience is not merely a matter of trade—it is a question of economic sovereignty. Countries that rely heavily on energy imports are always vulnerable to global market shocks. Therefore, the government must move its focus from short-term risk mitigation to more fundamental and sustainable strategies.

Urgent measures include boosting domestic oil production, expanding strategic energy reserves, and most importantly, accelerating the transition to renewable energy. Renewable energy is not only an environmental solution; in a global geopolitical context, it is also a form of national independence. Strengthening energy resilience allows Indonesia to withstand international disruptions without constantly depending on decisions made by other countries or facing oil price spikes that harm its population.

Furthermore, the global crisis should be treated as a catalyst for national energy reform. Policies that promote energy independence mean that Indonesia is not just “protected from global shocks” but also in control of its economic future. Energy security must be a cornerstone of economic and political stability, not merely a technical issue in crude oil trade.

In conclusion, preparing alternative oil import sources is both necessary and logical in the short term. However, this approach cannot stop there. Indonesia must take bolder steps, building energy independence through domestic diversification, strategic reserves, and a transition to clean energy. Only then will global geopolitical crises cease to be a direct threat to the people and the country’s economic stability.

Indonesia has the opportunity to turn a global challenge into a strategic advantage: not just surviving fluctuations in the world oil market, but leading a national energy transformation that is independent, resilient, and sustainable.

By : K&Co - March 16, 2026

Global Crises Call on Indonesia to Take Action

By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The recent meeting between President Prabowo Subianto and the Chief of the National Economic Council, Luhut Binsar Pandjaitan, underscores that global geopolitical uncertainty is no longer a distant issue for Indonesia’s economy. With the escalation of conflict in the Middle East causing energy price volatility and instability in global markets, Indonesia now faces tangible risks affecting energy security, fiscal stability, and government budgets.

That this meeting was called directly by the President is significant. It signals recognition that foreign conflicts—which may seem remote—can have immediate consequences for Indonesia, including surges in oil prices, disruptions to global supply chains, and pressures on the balance of payments and national budgets.

However, this meeting also raises a broader question: Is Indonesia truly prepared to withstand increasingly frequent global shocks? Heavy reliance on imported energy, limited strategic reserves, and vulnerability to international market fluctuations remain structural challenges that have been repeatedly noted but not fully resolved. Statements from President Prabowo assuring that domestic fuel and gas supplies are sufficient may provide short-term reassurance, but they do not change the reality that major geopolitical crises demand accelerated reforms in energy resilience and economic stability.

The focus on energy stability, oil pricing, and budget preparedness is pragmatic. Yet, it should also be a catalyst for Indonesia to reduce its dependence on global energy markets, boost domestic production, expand strategic reserves, and accelerate the transition to renewable energy. Dependence on imported oil not only weakens economic leverage but also exposes the country to heightened vulnerability amid escalating global geopolitical tensions.

Moreover, macroeconomic and fiscal policies must be designed to withstand external shocks. As other nations implement measures such as energy efficiency programs, demand management, and responsive monetary policies, Indonesia cannot afford to lag. Current geopolitical challenges should be viewed not merely as threats, but as a call to strengthen national resilience comprehensively.

Ultimately, the meeting between President Prabowo and Luhut is an important first step. But if responses remain limited to short-term preparedness, Indonesia will continue to react to crises rather than anticipate them. Strengthening energy resilience, diversifying the economy, and implementing bold fiscal reforms must be a long-term priority. Only with a comprehensive strategy can Indonesia ensure that global conflicts, like the ongoing turmoil in the Middle East, no longer shake the foundations of its national economy.

By : K&Co - March 16, 2026

The Search of the Ombudsman Office and the Test of Institutional Integrity

 By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The search of the office of the Ombudsman Republic Indonesia by investigators from the Kejaksaan Agung Republic Indonesia has drawn significant public attention. An institution known for supervising public services is now involved in a legal investigation. This situation raises questions among the public regarding the integrity of state institutions and the effectiveness of the existing oversight system.

The Ombudsman plays an important role in monitoring public services and handling public complaints related to maladministration by government institutions. Therefore, when this supervisory institution becomes part of a legal investigation, public trust may be affected. People may begin to question how an institution responsible for oversight could become involved in a law enforcement process.

However, the action taken by the Attorney General’s Office can also be seen as a demonstration of law enforcement that does not discriminate. In a state governed by the rule of law, no institution or individual is above the law. If there are allegations that certain parties are involved in a case, investigators have the authority to conduct searches and examinations to uncover the facts.

This case also highlights that the fight against corruption in Indonesia remains complex. Corruption often involves broad networks that may include private actors as well as public institutions. In such situations, law enforcement agencies must work professionally, transparently, and based on strong evidence so that the legal process can proceed fairly and without creating unnecessary speculation in society.

At the same time, the public should observe this case objectively while upholding the principle of the presumption of innocence. Legal processes must be allowed to run their course without excessive pressure or premature conclusions. If violations of the law are proven, those responsible must be held accountable according to existing regulations. Conversely, if no sufficient evidence is found, the reputation of the institution concerned should be restored.

This incident should serve as a moment of reflection for all state institutions to strengthen their internal integrity systems. Transparency, accountability, and ethical standards among public officials must remain priorities in carrying out governmental duties. By doing so, public trust in state institutions can be maintained.

Ultimately, strengthening institutional integrity is essential to building clean and credible governance. Public trust is a fundamental asset for ensuring that oversight, public service, and law enforcement functions operate effectively in Indonesia. Without that trust, efforts to create good governance will be difficult to achieve.

By : K&Co - March 9, 2026

Alert Status 1 and the Test of Civilian Supremacy in Indonesia

 By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The recent instruction by the Indonesian Armed Forces (TNI) leadership to enter Alert Status 1 has sparked a serious public debate. Civil society organizations argue that this policy is not only procedurally problematic but may also contradict constitutional principles. This criticism should not be dismissed as mere political polemic; rather, it serves as an important reminder about the relationship between the military, the state, and democracy in Indonesia.

The Civil Society Coalition for Security Sector Reform considers the instruction inconsistent with the constitution because military deployment is fundamentally under the authority of the President, as the highest commander of the Army, Navy, and Air Force, according to the 1945 Constitution. They also cite Law No. 34 of 2004 on the TNI, which stipulates that decisions regarding military deployment are vested in the President, not the TNI Commander.

From a state‑administration perspective, this criticism has solid grounding. In a modern democracy, the military must be under civilian oversight. Civilian supremacy is not only about formal command but also about accountability and political legitimacy. When decisions that could mobilize military forces are made without clear communication from the highest civilian authority, public concern is entirely understandable.

Furthermore, the civil society coalition questioned the urgency of declaring Alert Status 1. According to them, the current national security situation is still under the control of civilian government and law enforcement agencies, and there is no immediate threat to national sovereignty requiring widespread military mobilization.

The question of urgency is crucial. Alert Status 1 represents the highest level of military readiness, meaning troops and equipment are fully prepared for deployment. Without transparent explanations, this policy leaves room for speculation. In a democratic state, sensitive security policies require clear public communication to avoid unnecessary fear or suspicion.

Indonesia’s historical experience with military dominance in politics during the New Order era makes this issue particularly sensitive. The 1998 Reformasi period marked a major shift, separating military roles from civilian affairs and emphasizing TNI professionalism as a national defense institution. Any policy that blurs the line between military and civilian authority naturally triggers public sensitivity.

These concerns are not baseless. In recent years, debates about the TNI’s involvement in civilian roles and non‑combat operations have resurfaced, raising fears that security sector reform is not fully entrenched.

Nevertheless, civil society criticism should not be interpreted as being anti-military. On the contrary, such scrutiny is a vital mechanism in democracy to ensure that the military remains professional and operates within constitutional boundaries. A strong military in a democracy is not one above civilian control, but one whose legitimacy stems from adherence to law and democratic principles.

Ultimately, this controversy highlights the importance of transparency and public communication by both the government and the TNI. Clear explanations regarding the reasons, objectives, and legal basis for Alert Status 1 are necessary to prevent misunderstandings.

If managed well, this debate could strengthen Indonesia’s democracy. Civil society oversight, open government response, and adherence to the constitution form the foundation to ensure that the relationship between the military and the state remains firmly within democratic norms.

By : K&Co - March 9, 2026

Indonesia’s 25-Day Fuel Reserve as a Warning for National Energy Security

 By Kusnandar & Co., Attorneys At Law – Jakarta, Indonesia

 

The statement by Indonesia’s Minister of Energy and Mineral Resources, Bahlil Lahadalia, that the country’s fuel reserves can only last around 20–25 days should be taken as a serious warning about the fragility of Indonesia’s energy security. For a country with a large population, growing economic activity, and heavy reliance on fossil fuels, such a reserve level is relatively low. This situation is not merely a technical issue related to storage capacity but also reflects deeper structural challenges in the management of the nation’s energy system.

When compared with many other countries, the standard for strategic oil reserves is generally much higher. Several nations maintain energy reserves that can cover around 90 days of consumption as a precaution against potential disruptions in global supply. Such disruptions may arise from geopolitical conflicts, economic crises, or natural disasters that interfere with energy distribution routes. In these situations, countries with larger reserves are better positioned to maintain economic and social stability.

Indonesia actually possesses considerable natural energy resources. However, over the years, national energy demand has continued to rise alongside population growth and economic development. At the same time, domestic oil production has gradually declined and is no longer able to fully meet the country’s needs. As a result, Indonesia has become increasingly dependent on imported fuel. This dependence makes the nation more vulnerable to fluctuations in global oil prices as well as disruptions in international supply chains.

In his remarks, Bahlil emphasized that the main issue lies not only in the availability of oil but also in the limited storage infrastructure. In other words, even if the government intends to increase the national fuel reserve, the current storage facilities are not sufficient to accommodate a larger supply. This indicates that energy infrastructure development in the past may have focused more on distribution and consumption while paying less attention to strategic reserve capacity.

The government’s plan to develop larger fuel storage facilities should therefore be appreciated as an important initial step toward addressing this problem. If Indonesia manages to expand its storage capacity so that reserves can cover up to three months of consumption, the country’s energy security would become significantly stronger. Adequate reserves are crucial not only for responding to global crises but also for helping the government stabilize domestic fuel prices when international markets experience volatility.

However, building storage infrastructure alone will not be enough. Indonesia also needs to accelerate the diversification of its energy sources by developing renewable energy such as solar power, wind energy, geothermal energy, and bioenergy. This strategy is essential for gradually reducing the country’s dependence on petroleum. In addition, policies promoting energy efficiency must be strengthened so that national energy consumption can be managed more responsibly.

The issue of a 25-day fuel reserve should not be viewed merely as a temporary technical problem but rather as an opportunity to conduct a broader evaluation of Indonesia’s national energy strategy. Energy security is a fundamental component of national resilience. Without a strong and sustainable energy system, economic stability and long-term development could be put at risk.

Therefore, the government should treat this issue as a strategic priority. Investment in energy infrastructure, expansion of strategic reserves, and acceleration of the transition toward cleaner energy sources must move forward simultaneously. If these measures are implemented consistently, Indonesia will not only strengthen its energy security but also ensure more sustainable national development in the future.

By : K&Co - March 5, 2026