08/04/2026

BIZ & FINANCE WEDNESDAY | APR 8, 2026

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Mideast war to kickstart renewables boom: IEA chief

Bank Indonesia intervenes in market after rupiah hits record low JAKARTA: Bank Indonesia (BI) has inter vened to maintain the rupiah’s stability and avoid excessive volatility after the currency hit a record low against the dollar, senior deputy governor Destry Damayanti told Reuters yesterday. “Stabilising rupiah is certainly a top priority for us right now. We will use every tool and policy at our disposal, we will be all out,” she said, adding the pressure on the currency was largely due to global dynamics, including the market reaction to the US-Israeli war on Iran. The rupiah weakened by as much as 0.35% to 17,090 per dollar yesterday morning, according to LSEG data. The currency has fallen by more than 2% against the dollar in 2026, which is in line with some of its regional peers, the data showed. Destry said BI intervened in spot and non-deliverable forward currency markets, and was ready to buy government bonds in the secondary market if necessary. Autho rities will also try to increase inflows by improving the attractiveness of rupiah denominated certificates known as SRBI. She said the rupiah’s weakness would definitely have a negative impact on economic activity, although higher prices of its top commodities will help offset the impact. However, the rupiah breached the 17,100 level for the first time yesterday, defying the central bank’s earlier efforts to prop it up, as Middle East–fuelled energy shocks and lingering fiscal and gover-nance concerns chased foreign investors away. The currency sank to 17,105 per US dollar despite BI’s intervention earlier in the day to maintain the rupiah’s stability. On Monday, Indonesia’s finance minister said the budget deficit in the first quarter of 2026 stood at 0.93% of its gross domestic product (GDP). Purbaya Yudhi Sadewa was presenting the latest data on government revenues to parliament. Last year’s Q1 budget deficit was only 0.41% of GDP, and the increase this year was due to the frontloading of govern ment spending. Purbaya said Q1 spending stood at 815 trillion rupiah (RM192.3 billion), up 31.4% from the year before, while revenues hit 574.9 trillion rupiah, up 10.5% from the first quarter of 2025. He added that the government will keep the budget deficit below the legal ceiling of 3% of GDP this year. He also said the government will not increase prices of subsidised fuel amid an ongoing war in the Middle East, which has choked supplies and sent global oil price surging. Indonesia still has enough budget to maintain current prices, he added. – Reuters

million barrels per day within a week provided the Iran war ends and the Strait of Hormuz reopens. Among Gulf oil producers, Iraq has suffered the biggest drop in oil revenue as a result of the effective closure of the Strait, a Reuters analysis has found, because it lacks alternative shipment routes. But the country, the second biggest producer in the Organization of the Petroleum Exporting Countries, can quickly restore output to levels before US-Israeli attacks on Iran at the end of February led to the effective closure of the waterway. The strait typically is the route for about a fifth of global oil and LNG flows. Bassem Abdul Karim said Iran has so far provided only verbal guarantees that would allow Iraqi tankers permission to transit the strait. “We have not received any formal documents regarding permission for Iraqi tankers to pass,” he said in an interview with Reuters. He said production from Iraq’s southern oilfields was around 900,000 barrels per day, but if the war ends and safe passage through the strait is guaranteed exports could reach 3.4 million bpd within a week. – AFP, Reuters

“That is the case with renewables, such as solar and wind power, which can be installed very quickly. We will be turning to renewables very soon, probably within a few months,” Birol predicted. Even so, the IEA head insisted that countries should be “as prudent as possible” in saving energy in the short term, warning of the prospect of a “black April”. “If the strait does indeed remain closed throughout April, we will lose twice as much crude oil and refined products as we did in March,” Birol said, pointing out that the waterway was also a key transit point for fertilisers. He said the European countries, as well Japan, Australia and others will suffer, but the countries most at risk were developing nations which will suffer from higher oil and gas prices, higher food prices and a general acceleration of inflation. The IEA member countries agreed last month to release part of their strategic reserves. Some of this had already been released and the process continues, said Birol. In another development, the head of Iraq’s state-run Basra Oil Company said the country could restore crude oil exports to around 3.4

PARIS: The world’s worst energy crisis, caused by the Middle East war, will accelerate the development of renewables, nuclear energy and electric vehicles, the head of the International Energy Agency (IEA) has predicted. In an interview published yesterday with the French conservative Le Figaro newspaper, IEA executive director Fatih Birol argued that the current energy crunch “is more serious than those of 1973, 1979 and 2022 combined”. But despite the fuel price spike caused by Iran’s de facto blockade of the vital Strait of Hormuz chokepoint, there were “reasons to be optimistic” from how “the architecture of the worldwide energy system will change”. “It will take years. It will not be a solution to the current crisis, but the geopolitics of energy will be profoundly transformed,” said Birol. That said, some technologies would develop faster than others, he insisted. o ‘Current energy crunch ‘is more serious than those of 1973, 1979 and 2022 combined’

PHILIPPINE INFLATION SPIKES ... General view of the La Trinidad Vegetable Trading Post in Benguet province, the Philippines. Philippine inflation jumped dramatically in March, government figures showed yesterday, hitting a nearly two-year high of 4.1% on the back of historically high fuel prices driven by the Middle East war. The spike is the highest since July 2024 and well up from 2.4% in February. The Economic Planning Department said inflation in the transport sector was largely responsible for the March surge. Also contributing to the uptrend of the overall inflation is the food and non-alcoholic beverages index with a faster annual increase of 3% in March 2026 from 1.8% in the previous month, it added. – AFPPIC

Singapore unveils nearly S$1 billion package to cushion impact of Middle East war SINGAPORE: Singapore will deliver a support package worth almost S$1 billion RM3.13 billion), including cash handouts and fuel vouchers, to offset the economic impact of the Middle East conflict, Senior Minister of State for Finance Jeffrey Siow said yesterday. also drove up fuel prices. “We do not know how long the conflict and its economic impact will last, but the government is alive to the situation,” he said. Deputy Prime Minister Gan Kim Yong said early data indicated economic activity was resilient in the first quarter of 2026, although growth is likely to be affected by the conflict. The trade ministry has forecast growth this year at 2% to 4%, and Gan said any change to that would be announced after a regular review next month. electricity needs, and 9% of this year’s needs were expected to have been imported from Qatar. He said the city-state had not drawn on its reserves, which consist of natural gas and diesel, and was looking at increasing them even though it would be costly.

Measures include cash handouts to eligible Singaporeans, fuel vouchers for car-hire platform workers, private-hire car drivers and taxi drivers, as well as an increased corporate tax rebate of 50%, up from the 40% announced in the FY2026 budget in February.

He said Singapore, the world’s third-largest oil trading hub and sixth-largest refinery export hub, had continued to meet its domestic needs and international obligations for fuels.– Reuters

The measures follow the sharp rise in energy costs due to the Iran war, and Siow noted the support was greater than a package put in place after Russia’s invasion of Ukraine in 2022, which

Coordinating Minister for National Security K Shanmugam noted that Singapore depends on imported natural gas to generate 95% of its