SURABAYA – The impact of the conflict in the Middle East following military tensions between Iran and Israel is predicted to increase world crude oil prices.

The increase is even expected to far exceed USD82 per barrel, according to the assumptions set by the state budget.

This then became a concern for the Chairman of Indonesian Regional Representative Council (DPD RI) AA LaNyalla Mahmud Mattalitti.

As a result of the increase, subsidies in the energy sector, especially fuel, will increase and become a new burden on Indonesia’s fiscal.

A number of economists believe that an increase in subsidized fuel prices will be difficult to avoid if the rise in global crude oil prices continues for a long time.

“I wish the government would not take steps to increase the price of subsidized fuel. Because the timing is not good for the economic conditions of the people in the lower and middle class,” said LaNyalla, Tuesday (4/16/2024).

“We fasted in March, April is Eid al-Fitr, May will be school exams, and June will be school registration, not to mention Eid al-Adha in July. This is already a heavy burden for the community. Don’t add the fuel increase,” he continued.

LaNyalla said, during Ramadan and Eid al-Fitr Indonesians usually increase their spending. Especially those who go to their homeland, they spend relatively large transportation costs.

“After returning from their villages, people are faced with the children’s education agenda, starting from final exams and registration of new students or grade increases. So the government must pay serious attention to this matter,” he added.

LaNyalla suggested that the government through the finance ministry make adjustments or transfer budget allocations for ministry programmes that can still be postponed, to finance the impact of rising world oil prices if it lasts for a long duration.

“We realize that Indonesia’s oil lifting is far below our needs, so our imports are already above lifting,” he said.

“However, it is the government’s duty to find a solution that is oriented towards the country’s goals, one of which is to protect the people, especially those who must be protected,” he said.(Red)