Global Oil Price Surge Puts Pressure on Jakarta Composite Index

RRI.CO.ID, Jakarta - A sharp rise in global oil prices, driven by escalating conflict in the Middle East, is expected to weigh on Indonesia’s domestic stock market at the start of this week. Analysts warn that the Jakarta Composite Index (JCI) may face downward pressure as crude oil prices climb above USD 100 per barrel.

Associate Director of Research and Investment at Pilarmas Investindo Sekuritas, Maximilianus Nico Demus, projected that the JCI could weaken in trading on Monday, March 9, 2026. “Based on technical analysis, we see the potential for the JCI to weaken slightly with support and resistance at 7,460–7,860,” Nico said in Jakarta, as quoted by Antara.

Geopolitical tensions escalated after US and Israeli forces reportedly attacked Iranian military facilities and energy infrastructure, including oil storage depots around Tehran and Alborz province, sparking massive fires.

Iran responded by launching ballistic missiles and drones at Israel and targeting US military assets in several Middle Eastern countries. The situation has raised concerns over potential disruptions to global oil distribution.

The Middle East and the Hormuz Strait are vital routes for global energy trade, and prolonged conflict is feared to disrupt international oil supplies. At 7:50 a.m. Jakarta time, global crude oil prices rose sharply, with WTI recorded at USD 109.82 per barrel and Brent at USD 109.53 per barrel.

Nico assessed that the escalation of attacks on Iranian energy facilities could further drive up prices. “Especially if the conflict affects shipping lanes in the Hormuz Strait, which channels about one-fifth of global oil trade,” he said.

Domestically, the Indonesian government is considering adjusting the budget for the Free Nutritious Meals (MBG) program or raising subsidized fuel prices if the surge in oil prices burdens the 2026 State Budget.

Without policy adjustments, the budget deficit could widen to 3.6 percent of Gross Domestic Product (GDP). Nico noted that “an increase in subsidized fuel prices could trigger inflation, increase transportation and logistics costs, and reduce people’s purchasing power.”

Pressure was also seen in global markets after Wall Street stocks fell on Friday, March 6. The Dow Jones Industrial Average dropped 0.95 percent to 47,501.55, the S&P 500 weakened 1.33 percent to 6,740.02, and the Nasdaq Composite fell 1.59 percent to 22,387.68.

In the same trading session, the JCI closed down 124.85 points or 1.62 percent to 7,585.68. The leading stock index, LQ45, also fell 11.77 points or 1.49 percent to 776.04. ***