Sunday, April 14, 2024

Russia’s offers cheap oil to Indonesia sparks pro and contra issues

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Tourism and Creative Economy Minister Sandiaga Salahuddin Uno said that Russia offered Indonesia 30 percent lower oil prices than the international market and that India had previously purchased the oil from Russia. Sandiaga said President Jokowi wanted to accept the offer but several ministers refused because purchasing Russian oil would result in a U.S. embargo.

Energy Watch executive director Mamit Setiawan doubts that Indonesia will be prepared to face the risks if it decides to import crude oil from Russia, an idea recently floated by Tourism and Creative Economy Minister Sandiaga Uno.

According to Mamit, such a purchase would allow Indonesia to obtain crude oil at a 30% discount, easing the country’s financial burden and accelerating the production of affordable fuel. However, he believes that if talks of importing crude oil materialize, the government must ensure that Pertamina’s refineries can process Russian oil.

Center of Reform on Economics (CORE) senior economist Pieter Abdullah Redjalam said on Tuesday he supports Indonesia’s plan to import oil from Russia from an economic standpoint because the price is 30 percent lower than the international market and Indonesia itself is an importer country.

However, he said Indonesia must consider other factors, particularly in relation to the United States. He said the United States could seek ways to embargo Indonesia if it truly imports crude oil from Russia.

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