Indonesia Government Cuts Industrial LNG Prices

Jakarta: Energy and Mineral Resources Minister (ESDM) Bahlil Lahadalia announced that the government will reduce the price of liquefied natural gas (LNG) for the industrial sector to USD13 per Million Metric British Thermal Unit (MMBTU).
 
The government hopes that the price cut will help sustain industrial activity and prevent layoffs amid rising gas prices.
 
The reduction was executed under the direct instruction of President Prabowo Subianto, following a surge in industrial gas prices to between USD 20 and USD 23 per MMBTU.
 
“After reviewing calculations and meeting with the President, we decided to lower the price to USD 13 per MMBTU,” Bahlil said during a press briefing following a leadership meeting between the House of Representatives (DPR) and the government on Monday, June 29, 2026.
 
The government also ensured that the “Specific Natural Gas Price” (HGBT) will remain capped between USD 6.5 and USD 7 per MMBTU.
 
Likewise, the government will maintain the price of piped gas for non-HGBT industries in the Java region at USD9.6 per MMBTU.
 
Bahlil clarified that Indonesia is not facing a nationwide gas shortage, and that national gas production has met the target set in the State Budget (APBN).
 
Instead, he cited declining production from several gas fields in western Indonesia as the cause of the rising prices.
 
Consequently, LNG sourced from Papua, Sulawesi, and Kalimantan has been used to meet the demand in western Indonesia, increasing logistical costs.
 
“It requires transportation, regasification, and distribution via pipeline, leading to additional costs,” Bahlil explained.
 
(Jonathan Sianto)