Fuel Shortages Worsen Outside Java, Highlighting Energy Disparities

Long queues of vehicles at public fuel stations have become a daily sight in several regions outside of Java, Indonesia. In Jambi, queues of diesel-powered vehicles stretch to the roadside. Similar conditions are occurring in Merangin, Sarolangun, Muara Bungo, South Sumatra, and Lampung. Some drivers even have to wait overnight to get diesel fuel. This scarcity is considered more than just a distribution disruption. Sudaryadi, Director of Programs at Traction Energy Asia, stated that there are simultaneous pressures from fiscal, raw material supply, and governance sides. The implementation of Biodiesel 50 or B50 since July 1, 2026, increases the need for subsidies. When the Brent crude oil price is below US$101 per barrel, the production cost of biodiesel becomes more expensive than fossil diesel. This is because the price of biodiesel is also influenced by the price of crude palm oil as its raw material. "Throughout 2026, the downward trend in Brent prices widens the price gap between biodiesel and fossil diesel, thus increasing the need for biodiesel subsidies. In our study, this condition has the potential to increase fiscal burdens by approximately Rp80-100 trillion per year," said Sudaryadi. The B50 subsidy funds come from palm oil export levies managed by the Palm Oil Plantation Fund Management Agency (BPDPKS). When the need for subsidies grows faster than the revenue from levies, payments of incentives to biodiesel producers could be disrupted. Palm oil supply also faces competition between energy, food, and export needs. Biodiesel demand is projected to increase from around 12.5 million tons to 19.8 million tons by 2035. The government is urged to open data on fuel distribution, stock levels, and biodiesel blending realization to ensure the direct causes of the scarcity. Agus Praditya Tampubolon, Director of Climate and Just Energy Transition at IESR, said that energy resilience includes availability, affordability, ease of access, and public acceptance. This article was originally published on Mongabay