Indef Expects Russia-Ukraine War To Push Up Prices For Oil, Food, Processed Food And Gas

Illustration. (Photo: Doc. Antara)

JAKARTA - Head of the Center of Macroeconomics and Finance Indef, M Rizal Taufikurahman, revealed that the conflict between Russia and Ukraine will have an impact on economic aspects in Indonesia. According to him, although minimal, this conflict will push up commodity prices and Indonesian household consumption.

"Oil prices will increase, although since before the war it is also estimated that they will experience an upward trend, especially after the war. The increase may be 1.14 percent", Rizal said in the INDEF Public Discussion on War, Oil Prices and Its Impact on the Economy and Business in Indonesia, Wednesday, February 2nd.

Rizal added, the increase in oil prices will certainly have an impact on the transportation sector which is also connected to other commodity markets which will certainly affect the optimization and production of commodities.

"All sectors that use fuel directly will of course be affected because it includes logistics and transportation", he said.

Rizal further estimates that price increases will also occur in several commodities that are starting to experience price increases, namely food, processed food, and gas.

"Almost all sectors will increase, driven by transmission from oil because oil affects almost all sectors. Including meat, which has started to rise in the face of fasting and Eid. Inflation is very likely to occur", he said.

Rizal asked the government to take anticipatory steps regarding the impact that the Russia-Ukraine war would have on the national economy.

"This war is unpredictable. We do not know when it will end, so the government needs to take preventive steps so that this does not happen. There is a possibility of an increase in various commodity prices which is very possible in the short term", he added.