Last night, a message popped up on my phone, sent to my group named Vietnam Trip 2026. A friend sent us a link to an Instagram reel with a thumbnail that said, “If you have a flight booked to Vietnam in April—watch this now. The Middle East conflict isn’t just a news story. It’s showing up in your everyday life in Vietnam right now.” The video basically said that Vietnam’s aviation is under serious pressure because Vietnam airlines is cutting 23 flights a week starting April 1. Meanwhile, Vietjet scrapped its entire Vietnam-Japan schedule for April. Up to 1000 total flights could be gone by May.
Watching the reels my friend sent, my other friends responded in blue tones. We knew it the moment Iran decided to close the Strait of Hormuz. We also have expected that the effect would come this close. However, it still feels annoying to know that our booked trip to Vietnam could be disrupted. It is more annoying to realize that our daily lives will soon be affected, too.
Those who say politics does not affect our lives really need to open their eyes. This war has not reached us physically, as if we haven’t had mortars raining down on our roofs. Yet, indirect impacts are serious and fast-moving. The effects have cascaded across multiple levels.
What happens with countries
First thing happening, immediate energy shocks. Oil prices will spike sharply, potentially reaching $150- $ 200 per barrel, as major exporters struggle to ship oil and gas. Supply suddenly drops while demand remains constant. The Philippines has declared a national energy emergency. Philippine President Ferdinand Marcos Jr called the US-Israel war on Iran an imminent danger to the country’s energy supply.
Earlier this week, Secretary of Energy Sharon said the country still has about 45 days of fuel supply at current consumption levels. Meanwhile, Prime Minister Anthony Albanese from Australia will convene a second emergency national cabinet meeting as rising fuel costs and shortages threaten to disrupt a range of industries and push up consumer prices.
South Korea, on the other hand, is seen as strictly enforcing a mandatory five-day vehicle rotation system for the public sector to respond to oil supply disruptions amid continued hostilities. Electric and hydrogen vehicles are exempt from such restrictions.
Where is Indonesia amidst this chaos?
Our Ministry of Finance, Purbaya Sadewa, said this morning (March 29) that we will not be affected by the energy issues in question. Yet, I might say. He said that Indonesia will have oil prices subsidised by the state budget. Statements that only raise my eyebrows any further.
So cynical, I know, but I can’t help. With our neighbouring countries on high alert, such gestures from our officials do no good. People in the Philippines walk to work and school to save fuel. The same can happen here, too. I cannot imagine going to work on foot. My office is 19 kilometers away from home.
What can happen to Indonesia?
As much as the officials want to deny it, there are foreseen shocks transmitted through prices, trade, and fiscal pressure rather than physical supply disruption. Since Indonesia is a net oil importer, global oil price spikes will eventually result in surging BBM costs. At least there are several immediate dilemmas: increased subsidies that will raise the burden on the state budget, or a rise in domestic prices that will risk public backlash.
Secondly, the possibility of inflation spiked. Higher energy prices ripple through the economy, with rising transport costs (making logistics more expensive), higher food prices (driven by higher distribution and production costs), and the possibility of electricity tariffs coming under pressure.
Thirdly, the possibility of economic growth slowing down. Higher production costs caused by output reductions or price increases by firms, weakened household consumption due to higher living costs, and cautious investment could slow GDP growth significantly, especially if the crisis is prolonged. Lastly, financial market volatility. The stock market can decline, especially in the transport and manufacturing sectors. Bond yields can rise, causing higher risk perception. Aside from that, capital outflows can increase.
For Indonesia, the Hormuz closure and this not-yet-ending war are less about running out of oil and more about price shocks, fiscal stress, inflation, and currency pressure. If not managed well, it can become a macroeconomic stability issue. If managed well, it could become a turning point toward energy independence by accelerating structural reforms and pushing towards energy transition.
The official can use several methods to lessen the shock, such as providing energy subsidies and targeted social assistance, adjusting fuel pricing policy without burdening the people, and coordinating with economic bodies, such as Bank Indonesia, to discuss interest rate hikes and interventions to stabilize the rupiah.
As a young person who wants to have fun, I sure hope my trip to Vietnam goes smoothly and without distractions. But on top of that, I wish the officials could overcome the foreseen crisis with effective measures so that I do not have to walk to my office.
