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Arab News
11 hours ago
- Business
- Arab News
Indonesia to cut Middle East oil imports to meet Trump's tariff deal
JAKARTA: Indonesia will reduce oil and gas imports from Middle Eastern and Asian countries, Energy and Mineral Resources Minister Bahlil Lahadalia said, as Jakarta moves to implement its $15 billion energy deal with the US under the latest tariff agreement. Indonesia is among three Southeast Asian countries that have struck deals with Washington so far, following negotiations with US President Donald Trump to lower tariff rates. Jakarta has agreed to increase its imports from the US by more than $22 billion — including energy products — under the framework trade deal, while US tariffs on Indonesian imports would be set at 19 percent. 'We have agreed to buy $15 billion worth of gasoline, crude oil and LPG (liquefied petroleum gas), which we will do in steps by considering its economic viability. The prices must be competitive, and now we're designing a framework for it,' Lahadalia told reporters in Jakarta on Monday. 'We will reduce (imports) from other countries (in) the Middle East and Asia.' Southeast Asia's biggest economy's oil imports were valued at about $36 billion last year. While the US is among Indonesia's top oil suppliers, Washington still ranks behind Singapore, Malaysia and Saudi Arabia. The US deal, which is expected to be finalized in the coming weeks, allows Indonesia to avoid the higher tariff rate of 32 percent threatened earlier by the Trump administration. 'We know that 32 percent (tariff rate) means no trade, which basically means a trade embargo, and that means around 1 million workers in labor-intensive sectors can be impacted,' Coordinating Minister for Economic Affairs Airlangga Hartarto said in a statement. 'What the government is doing through this cooperation with the US is to keep the internal and external balance so that we can maintain our trade balance, keep our economic momentum and ensure job creation.' The US is Indonesia's second-largest market after China, with exports valued at over $26 billion in 2024, according to Indonesia's statistics agency. Indonesia has consistently posted trade surpluses with the US in the past decade, including $16.8 billion last year. Under the tariff agreement, Jakarta agreed to drop its tariff on nearly all American imports to zero and scrap all non-tariff barriers facing American firms, while also committing to purchase $4.5 billion worth of agricultural products from the US, including soybeans, wheat and cotton, as well as Boeing aircraft valued at $3.2 billion.
Ammon
16-07-2025
- Business
- Ammon
Jordan, Saudi Arabia discuss joint geological surveys, mining sector cooperation
Ammon News - Minister of Energy and Mineral Resources Saleh Kharabsheh on Wednesday emphasized the significance of strengthening Jordanian-Saudi cooperation in geological surveying and data sharing along shared border areas, to support the development of the mining sector in both countries. His remarks came during a meeting with Saudi Deputy Minister of Mining Affairs Khaled bin Saleh Al-Mudaifer, held on the sidelines of the Egypt International Mining Forum 2025. According to a statement by the Ministry of Energy and Mineral Resources, discussions focused on mechanisms for conducting joint geological surveys and enhancing the exchange of technical information. The two sides also explored the possibility of organizing an introductory meeting to bring together companies active in the mining sector from both countries, aiming to boost exploration efforts and encourage partnerships between the public and private sectors. Petra
Jordan News
16-07-2025
- Business
- Jordan News
Regional mining cooperation 'key' to building sustainable sector-Kharabsheh - Jordan News
Minister of Energy and Mineral Resources, Dr. Saleh Kharabsheh, stressed the importance of regional cooperation and unified efforts to exploit shared geological formations. اضافة اعلان The minister made the remarks during his participation in Egypt Mining Forum 2025, which kicked off Tuesday, in the Egyptian capital, Cairo, and will continue for two days with broad regional and international participation from ministers, experts, and decision-makers in the mining sector. Kharabsheh noted many mineral-rich formations, mainly the Arabian-Nubian Shield (ANS), "do not recognize political borders and extend across several countries, including Egypt, Saudi Arabia, and Jordan." Talking to a ministerial panel discussion, themed: "Attracting Strategic Partners and Emerging Exploration Companies to Drive Long-Term Growth in the Mining Sector," Kharabsheh said the ministry signed a cooperation agreement with the Saudi Ministry of Industry and Mineral Resources to exchange information and study cross-border geological formations. Kharabsheh referred to a similar partnership with the Egyptian side, as part of efforts to maximize the benefits of these shared natural resources. According to a ministry statement, Kharabsheh pointed to Jordan's ambition to build transformative industries based on its national resources. The minister added that this approach "opens the door to integrated" projects that may rely on raw materials available in Saudi Arabia or Egypt, which would enhance opportunities for establishing mutual industries and provide an "attractive" environment for "major" companies seeking cross-border regional business opportunities. Kharabsheh noted regional cooperation in the mining field represents a "fundamental pillar" for building a "sustainable" sector to achieve shared economic growth, calling for continued coordination among Arab countries concerned with mineral resources to maximize the potential of available resources. During the session, attendees discussed the governments' role in providing an attractive and stable investment environment through clear regulations and guaranteed property rights, aimed at attracting capital and companies specializing in exploration and development. Hisham Zyoud, Director of the ministry's Mining Directorate, took part in a sub-panel discussion, titled "Beyond Gold: Base Metals and Critical Minerals in the Arabian-Nubian Shield," which discussed ways to transform the ANS's historically known gold-rich deposits into a major source of base metals and critical minerals that support the growing global demand for raw materials necessary for industrial and technological transformation. Participants stated the shield, which extends across Egypt, Sudan, Eritrea, Ethiopia, Saudi Arabia, and Jordan, is one of the oldest and richest geological regions in the world. The forum, which is a key platform for exchanging expertise and reviewing investment opportunities in the mining sector in the Arab region, reflects interest of the region's countries in developing their natural resources and enhancing their role in global mineral markets.
Business Times
15-07-2025
- Business
- Business Times
Indonesia battles oil production slump with bold new drilling plans
[JAKARTA] Indonesia is banking on 75 newly offered oil and gas blocks to stem its declining domestic output, but analysts warn that the boost may be short-lived unless deeper investment and structural reforms follow. The government hopes the expanded portfolio will help lift production to 605,000 barrels a day this year and eventually reach its longstanding target of one million barrels by 2030. But with more than half of Indonesia's crude oil needs already met through imports and demand still rising, the stakes are high if these new blocks fail to deliver. Prateek Pandey, senior vice-president and head of Asia-Pacific oil and gas analysis at Rystad Energy, said that Indonesia's target, while ambitious, is not out of reach if the right pieces fall into place. 'Production upside brings a short-term momentum. But the real challenge isn't reaching 605,000 barrels; it's sustaining it,' he told The Business Times. New blocks to drill Of the 75 blocks offered, 61 are currently open for bidding. These include resource-rich but underexplored areas such as Seram-Aru and Cenderawasih Bay II and III in the Maluku and Papua regions, which officials hope will attract long-term investment and help diversify the national production base beyond traditional oil and gas hubs. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The government has also identified 14 more areas for future licensing rounds, including Bukit Barat, Halmahera-Kofiau, Semai IV, and Akimeugah. Deputy Minister of Energy and Mineral Resources Yuliot Tanjung said on Jul 8 that the blocks are being offered under production-sharing contracts (PSCs), which allow companies to recover their exploration and development costs before sharing profits with the government. Deputy Minister of Energy and Mineral Resources Yuliot Tanjung says the new blocks are being offered under production-sharing contracts. PHOTO: ELISA VALENTA, BT He added that some blocks already have winning bidders, while others remain open for bidding or are being prepared for future tenders. Rikky Rahmat Firdaus, deputy for exploration in the Upstream Oil and Gas Regulatory Task Force, said that Malaysia's Petronas and Total E&P Indonesie will begin exploration drilling next year in the Bobara Block, a 8,500 square kilometre oil field in Papua. Firdaus pointed out that Indonesia could see additional production this year from two oil and gas blocks, including state-owned energy firm Pertamina's existing assets such as ExxonMobil's Cepu Block, which may contribute around 30,000 barrels a day. Further gains are expected from newer fields such as Forel and Terubuk, which are projected to add another 20,000 barrels per day combined. Declining output Once a major oil producer, Indonesia has seen a steady decline in domestic output, leaving the country increasingly reliant on imports to meet its energy needs. In the 1990s, oil and gas production peaked at around 1.5 million barrels a day, but output has since dropped significantly. Komaidi Notonegoro, executive director of the Jakarta-based think tank ReforMiner Institute, said the country's upstream oil and gas industry has been grappling with increasingly complex challenges in recent years. He noted that a key concern is Indonesia's heavy reliance on ageing wells, with around 52 per cent of the output coming from mature fields nearing the end of their productive life. Reversing the downward trend in domestic output is no easy feat, said Komaidi, as it requires balancing the economic viability of upstream projects with the government's fiscal limitations, a delicate act of walking a tightrope between industry needs and state finances. 'In general, managing oil and gas fields in the mature phase requires special treatment, as production and maintenance costs tend to rise while output continues to decline,' he noted. Pandey from Rystad Energy said that most of Indonesia's recent oil and gas block awards have reverted to the cost-recovery PSC model, marking a shift away from the gross split scheme introduced in 2017. The cost-recovery model is seen as more appealing in today's uncertain market. 'While fiscal terms are generally not seen as a major obstacle, above-ground risks and domestic-market dynamics continue to weigh heavily on the commercial viability of projects,' he said, pointing to investor caution amid unstable Brent prices in 2025. Operators, he added, are becoming increasingly hesitant to invest in both brownfield developments and high-risk exploration. Energy security Indonesian President Prabowo Subianto has placed energy security at the heart of his economic agenda, vowing to reduce import dependence and ramp up domestic oil production. The push is not only about securing supply, but also about curbing rising energy import bills and easing long-term fiscal pressures. Indonesia's fuel subsidy amounted to 500 trillion rupiah (S$39.4 billion) last year. The country currently consumes around 1.6 million barrels of oil a day, with domestic production accounting for only 600,000 barrels, while the remaining one million barrels are met through imports. Dr Yayan Satyakti, a lecturer and researcher at Padjadjaran University, warned that the growing gap between domestic supply and demand would not only erode energy resilience but also carry broader economic, fiscal, and geopolitical consequences for Indonesia. 'Higher energy imports mean more spending in foreign currency, potentially worsening Indonesia's current account balance and putting pressure on the rupiah,' Dr Yayan said. Pandey noted that, amid rising geopolitical tensions that could fuel energy price volatility, countries around the world are re-evaluating their domestic oil and gas potential and Indonesia is no exception. The South-east Asian nation is also seeking to buy more crude oil from the US, part of its broader negotiation with Washington to lower the 32 per cent import tariff that is still under review. While this effort will remain relevant, domestic potential is likely to take priority, said Pandey.
Business Times
15-07-2025
- Business
- Business Times
Indonesia looking at levy on coal exports to boost state coffers
[JAKARTA] Indonesia, the world's biggest coal exporter, may impose an export levy on the fossil fuel in a bid to boost state revenues, according to local media reports that cited a government minister. The tariff would only be collected from miners when coal prices are high, with authorities still determining what level that would be, Energy and Mineral Resources Minister Bahlil Lahadalia told reporters after a parliamentary hearing in Jakarta on Monday (Jul 14). He also said a similar levy on gold exports was being considered. 'If prices are good, then they should share some of those earnings with the state,' he was quoted as saying by multiple media outlets. 'But if prices aren't economic, then we shouldn't burden businesses either.' Prabowo Subianto's administration has been rolling out an array of revenue-boosting measures to fund the president's big-ticket spending plans, which include free meals for all school children and construction of public housing. The royalty rates paid by nickel, tin and other miners were also raised earlier this year to bolster state coffers. An export levy would add to the royalties already imposed on coal production, which are a major source of non-tax state revenue for Indonesia. The sprawling archipelago produced 834 million tonnes of the fuel last year, roughly half of which was exported, according to government data. The plan creates policy uncertainty for Indonesian miners, and could add to refinancing risks for high-yield companies with limited liquidity and diversification, Mary Ellen Olson, a Bloomberg Intelligence analyst, said in a note. Indika Energy, Medco Energi Internasional, Mining Industry Indonesia and Freeport Indonesia are potentially most at risk, she said. BLOOMBERG
