Hormuz crisis and the economic cost of Indonesia’s work-from-home policy
The Indonesian government’s plan to implement a one-day-a-week Work From Home (WFH) policy for civil servants following the 2026 Eid holidays signals a form of fiscal anxiety in response to persistent global geopolitical turbulence. The escalation of conflict in the Middle East has pushed global crude oil prices above the psychological threshold of $100 per barrel, placing Indonesia, as a net oil importer, in an increasingly precarious fiscal and financial position.
Put differently, the “four days at the office, one day at home” scheme functions as an emergency brake aimed at containing the state budget deficit.
The government projects that reducing one day of work-related mobility could cut national fuel consumption by as much as 20 percent, equivalent to one-fifth of daily usage.
The government projects that reducing one day of work-related mobility could cut national fuel consumption by as much as 20 percent, equivalent to one-fifth of daily usage.
Yet such optimism warrants scrutiny. Will savings on one front genuinely ease fiscal pressures, or will they instead cannibalize the real economy, inflicting deeper long-term damage on national growth?
In the 2026 state budget (APBN), fiscal rigidity is exceptionally high. Government spending is heavily absorbed by new flagship programs such as the Free Nutritious Meals initiative, which alone costs Rp 335 trillion, alongside the Merah Putih Cooperative program, also requiring tens of trillions. Meanwhile, debt servicing obligations, including interest payments and maturities, are projected to reach a staggering Rp 1,433.4 trillion. Under such strain, energy subsidies become the most vulnerable component, effectively targeted for reduction—if not outright sacrifice—through mobility restrictions.
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The choice of the post-Eid period as the starting point for the policy is both strategic and problematic. Historically, this period marks a peak anomaly in national energy consumption due to mass return travel and heightened mobility. By enforcing WFH, the government aims to recalibrate energy demand to avoid shocks to foreign exchange reserves and subsidy allocations. The critical question, however, is........
