Global Oil Geopolitical Risk and Indonesia's Petroleum Vulnerability: Implications for Economic Stability

Maulia Ikhsan Sopali; Muhammad Iqbal; Rizna Nur Rahmadhinta; Rudy Sutanto

doi:10.29017/scog.v49i4.2194

Authors

Maulia Ikhsan Sopali Sekolah Tinggi Intelijen Negara
Muhammad Iqbal Sekolah Tinggi Intelijen Negara
Rizna Nur Rahmadhinta Sekolah Tinggi Intelijen Negara
Rudy Sutanto Universitas Pertahanan, Indonesia

DOI:

https://doi.org/10.29017/scog.v49i4.2194

Keywords:

geopolitical risk, petroleum vulnerability, oil import dependence, petroleum security, economic stability, Indonesia

Abstract

Indonesia's growing dependence on imported crude oil and petroleum products increases its exposure to disruptions originating in global oil markets. This study examines how geopolitical disturbances interact with structural weaknesses in Indonesia's petroleum system and how the resulting pressures are transmitted into the domestic economy. Using qualitative document analysis covering 2004–2025, the study integrates peer-reviewed research, official Indonesian statistics and policy documents, and reports from international energy institutions. The findings show that geopolitical disturbances affect Indonesia through different channels, including physical supply disruption, trade reallocation, maritime-logistics constraints, and short-term price risk. These pressures are amplified by limited domestic production, refinery constraints, import dependence, and limited petroleum-buffer capacity. In 2024, petroleum-product imports reached approximately 791 thousand barrels per day, while Indonesia's planned Petroleum Buffer Reserve provides only about 12 days of crude-import protection. Economic effects may appear through exchange-rate pressure and inflation or be partly absorbed through subsidies and fiscal compensation. The study argues that geopolitical crises do not create Indonesia's petroleum vulnerability; rather, they expose and amplify pre-existing structural weaknesses. Strengthening resilience therefore requires coordinated improvements in domestic production, refining capability, supplier diversification, demand management, and petroleum-buffer capacity.

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