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Indonesia mulls buying Russian oil despite Western sanctions as fuel prices soar

Monday, 12 September 2022 8:59 AM [ Last Update: Monday, 12 September 2022 8:59 AM ]

Indonesian President Joko Widodo and his Russian counterpart Vladimir Putin, 2014. (TASS Photo)

Indonesia is considering joining neighbors India and China in buying Russian oil to tackle the pressure of rising energy costs, a report quoted the South Asian country’s president as saying on Monday.

In an interview with the Financial Times, President Joko Widodo said they “always monitor all of the options”, keeping open the option of purchasing Russian oil despite Western sanctions.

“If there is the country (and) they give a better price, of course," Widodo said when asked whether Indonesia would buy oil from Russia.

Indonesia has not imported considerable amounts of oil from Russia for years, but amid increase of fuel costs by 30 percent this month, Widodo’s government finds itself under tremendous pressure to curb rising costs.

“There is a duty for [the] government to find various sources to meet the energy needs of their people. We want to find a solution,” Widodo added.

The Indonesian leader’s comments about importing oil from Russia comes after the decision by the European Union (EU) and Group of Seven (G7) nations to propose a price cap on Russian gas in order to prevent the fuel prices from getting worse.

‘Your energy price ceiling will become price floor:’ Top Russian lawmaker warns Europe

Russia has denounced the European attempts to cap the Russian energy prices, saying that such measures are doomed to fail and prices will rise beyond the attempted artificial ceilings.

Western governments, and especially the European countries, have been grappling with a worsening energy crisis after sanctioning Russia for its military operation in Ukraine.

Russia launched a military operation in Ukraine in late February, following Kiev’s failure to implement the terms of the 2014 Minsk agreements and Moscow’s recognition of the breakaway regions of Donetsk and Luhansk.

At the time, Russian President Vladimir Putin said one of the goals of what he called a “special military operation” was to “de-Nazify” Ukraine.

In response, the Western governments imposed a slew of sanctions against Russia and supplied Ukraine with sophisticated weaponry, prompting Moscow to announce its counter-measures.

Buying Russian oil above the price cap might potentially bring US sanctions against Indonesia, as Washington has threatened the nations importing Russian energy resources without considering the price cap.

However, Indonesia has long followed a policy of non-alignment with superpowers, with Widodo visiting Moscow and Kiev in June to personally invite their leaders to the G20 summit.

If Indonesia goes ahead with the move, it would join India and China in helping Moscow offset much of the consequences of the western sanctions.

It is worth noting that Indonesia and Russia have several large energy projects planned, including a $16bn refinery in East Java being built by Pertamina and Russia’s Rosneft.

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