Indonesia cuts natural gas flows to Singapore to protect local power supply

Indonesia has started lowering its natural gas exports to Singapore so that more energy can be channeled toward its own power grid, regulatory authorities announced.

Djoko Siswanto, head of the upstream oil and gas agency SKK Migas, said the move redirects 31 million standard cubic feet of gas daily to fuel electricity generation in Sumatra, Batam, and Bintan. The cut involves 16 million cubic feet from Sumatra and 15 million from Natuna, accounting for approximately 9 percent of Indonesia's regular gas shipments to Singapore. The agency explained that the measure was necessary to ensure reliable fuel supplies for local power generation.

The decision follows several disruptive power disruptions across Indonesia. A widespread blackout hit at least six provinces in Sumatra in May, followed by rolling power cuts across Java and Kalimantan during June and July. Most recently, Batam suffered an outage lasting 16 hours.

Singapore relies heavily on imported natural gas, which fuels more than 90 percent of its electricity generation. Piped supplies from Indonesia and Malaysia covered roughly 43 percent of its imports last year, while liquefied natural gas arriving by sea accounted for the remaining 57 percent.

Despite that dependency, officials in Singapore said the export reduction would not disrupt local power availability. The Energy Market Authority stated the curb equates to roughly 17 billion British thermal units daily across an 18-day stretch, which represents less than 2 percent of the country's daily gas requirements.

Tan See Leng, Singapore's minister for energy, trade, and industry, reassured the public that current reserves are sufficient and that short-term power prices should remain largely unaffected. He noted that the country continues to diversify its import sources to handle potential disruptions and emphasized that similar cutbacks have been handled smoothly in the past.

The export curbs align with Jakarta's long-standing domestic market obligation rules, which require commodity and resource developers to allocate specific portions of output locally before exporting. Indonesia has previously implemented temporary bans on coal exports and restricted shipments of unrefined ores such as nickel, bauxite, and copper.

Indonesian Energy Minister Bahlil Lahadalia signaled the adjustment days earlier, stating that Jakarta would prioritize domestic energy requirements under directives from President Prabowo Subianto. The minister also remarked that supplies could be reconsidered for countries that do not show respect toward Indonesia, without identifying any specific nation.

The export adjustment comes amid broader friction between the two Southeast Asian neighbors. Singapore has recently voiced frustration over transboundary smoke drifting from forest and peatland fires in Sumatra and Kalimantan, with officials warning that firms linked to the burning could face legal action. Indonesian financial markets also experienced recent volatility after index compiler MSCI considered downgrading the country's market status, prompting accusations from some former officials regarding Singaporean investment firms, which the institutions denied.