Jakarta eyes discounted Saudi crude oil amid hike

JAKARTA: Indonesia is open to buying crude oil from Saudi Arabia, which has offered discounts to Asian buyers for November, Coordinating Downstream and Energy Transition Minister Bahlil Lahadalia says.

The government would consider “oil from any source” as long as prices are competitive, procurement is efficient and purchases comply with regulations, Bahlil noted.

“Regardless of the source, oil will be a priority for the government as long as it is cost-efficient and the purchase complies with regulations,” Bahlil said on Monday, as reported by Kompas.com.

Bahlil also confirmed that Indonesia had bought crude oil from the United States, adding that the government was open to imports from any country offering competitive prices and complying with regulations.

Crude oil prices rose on Monday as attacks on Saudi Arabia heightened supply concerns, offsetting the prospect of more Russian energy reaching global markets after the United States eased sanctions on its diesel exports.

Brent crude climbed nearly US$2 a barrel to US$106.65, its highest since Sept 15, extending a rally that has kept prices above US$100 since early September.

Saudi Arabia, the world’s largest oil exporter, has been stepping up efforts to move crude through the Strait of Hormuz, with several Asian refiners buying November cargoes on the spot market, Reuters reported on Monday.

State-owned Saudi Aramco set its November official selling price for flagship Arab Light crude at US$5 a barrel below the average of Oman and Dubai prices, the lowest in six years, as it sought to attract buyers and offset elevated freight costs.

It also cut prices for Arab Medium and Arab Heavy crude oil sold to Asia by US$5 a barrel.

Moreover, Aramco is also considering discounts for crude loaded in Oman to compensate buyers for record-high shipping costs, sources familiar with the matter told Reuters.

The move would help the company defend market share after the United States-Israeli against Iran disrupted its exports.

Indonesia has lost about a quarter of its crude oil supply sources since the Iran war broke out eight months ago, according to Laode Sulaeman, oil and gas director general at the Energy and Mineral Resources Ministry.

The supply loss has forced the government to scramble for alternative sources, with state energy firm Pertamina shifting from tenders to directly approaching countries with surplus crude for purchases, Laode said.

The government has also shifted some crude oil imports from the Middle East to the United States and Russia following the prolonged Middle East conflict, according to government data and previous official statements.

Last month, Bahlil said the government would prioritise oil and gas imports from suppliers offering more competitive prices while taking into account the state budget’s capacity.

Indonesia’s crude oil price rose to US$112.81 a barrel in September, up US$23.38 from US$89.43 in August, far surpassing the US$70-per-barrel assumption in the 2026 state budget.

As a net oil importer, Indonesia brought in 11.69 million tonnes of crude petroleum in January to August, Statistics Indonesia data showed.

In addition, Nigeria, Saudi Arabia and Angola were among its largest suppliers, according to the data. — The Jakarta Post/ANN