Amid soaring global crude prices surpassing $100 a barrel, Indonesia is ramping up its efforts to boost domestic oil exploration and production. The nation’s average output has lingered below 600,000 barrels per day, significantly trailing the government’s ambitious target of over 1 million barrels daily, according to Deputy Energy and Mineral Resources Minister Yuliot Tanjung.
The surge in global oil prices has underscored Indonesia’s urgent need to expand its domestic oil resources and diminish its reliance on imports. Between January and July 2026, Indonesia’s crude oil production averaged approximately 578,000 barrels per day. Several domestic oil fields have been identified with the potential to increase production, with estimates suggesting they could yield between 2,500 and 3,000 barrels per day.
In a bid to stimulate exploration and production activities, the Indonesian government plans to accelerate these efforts in 2027 and 2028. To attract both state-owned and private companies to invest in new projects, the government aims to provide incentives. This initiative comes in response to a significant rise in the nation’s oil and gas import costs, which reached $25.77 billion in the first seven months of 2026—an increase of more than 40% compared to the same period the previous year.
Despite the escalating global prices, the Indonesian government intends to maintain current subsidized fuel prices through the end of 2026. However, prices for nonsubsidized fuel will continue to fluctuate in accordance with market conditions. This approach is part of the government’s strategy to manage the economic impact on consumers while pursuing increased energy self-sufficiency.