The Indonesian government has moved to cap domestic liquefied natural gas (LNG) prices at US$13 per million British thermal units (MMBtu), a policy shift designed to shield local industry from rising energy costs.
The Ministry of Industry has welcomed the measure, framing it as a critical boost for manufacturers facing margin pressure.
PT Perusahaan Gas Negara (PGN), the state-owned gas distributor, has confirmed it is prepared to implement the directive, selling LNG to domestic industrial customers at the capped rate.
The price ceiling represents a significant intervention in Indonesia's energy market, effectively decoupling domestic industrial gas prices from global spot benchmarks.
For energy traders, the move signals a tightening of supply availability for export markets, as the government prioritizes domestic consumption and employment preservation.
While the policy supports industrial competitiveness, it introduces margin risk for PGN, which must now manage the spread between its procurement costs and the regulated selling price.