Indonesia Hikes Aviation Fuel Surcharge Ceiling to 38 Percent Following Middle East Energy Market Volatility

Indonesia sets a new 38% fuel surcharge ceiling for jets and propellers to combat rising oil prices. Government targets airfare growth between 9% and 13%.

By: AXL Media

Published: Apr 7, 2026, 5:33 AM EDT

Source: Information for this report was sourced from ANTARA

Aggressive Fiscal Adjustments in Response to Regional Conflict

The Indonesian administration has implemented a sweeping overhaul of its aviation pricing structure as the conflict in the Middle East continues to destabilize international energy markets. By raising the fuel surcharge ceiling to 38 percent for all aircraft types, the government is providing a critical financial buffer for airlines struggling with the rising cost of kerosene. This policy shift represents a significant departure from previous regulatory limits, which had kept surcharges for jet-powered aircraft at a much lower threshold, reflecting the urgent need to address the deteriorating economic environment facing the domestic transport sector.

Harmonizing Surcharge Limits Across Aviation Platforms

Under the new directive announced by Coordinating Minister Airlangga Hartarto, the previous distinction between different propulsion systems has been eliminated in favor of a unified ceiling. Prior to this adjustment, jet aircraft were restricted to a 10 percent surcharge, while propeller planes operated under a 25 percent limit. The new mandate effectively increases the allowable surcharge for jets by 28 percent and for propellers by 13 percent. This standardization ensures that regional carriers operating smaller aircraft and trunk-line operators using major jet fleets have equal leeway to recover the fluctuating costs associated with global fuel procurement.

Regional Price Benchmarking and Competitive Positioning

Despite the internal price hikes, government officials maintain that Indonesia’s aviation fuel remains economically viable compared to its Southeast Asian neighbors. Minister of Energy and Mineral Resources Bahlil Lahadalia pointed out that while Pertamina’s prices have inevitably climbed, they remain lower than those found in nearby hubs. Specifically, jet fuel in Indonesia is currently priced at Rp23,551 per liter at Soekarno-Hatta International Airport, a figure that sits comfortably below the Rp29,518 per liter seen in Thailand and the Rp25,326 per liter reported in the Philippines, according to data provided by Minister Hartarto.