Indonesia’s energy minister has pushed back against Singapore’s concerns over reduced natural gas supplies, insisting that the cuts remain within contractual limits and rejecting suggestions that Jakarta is failing to honour its international commitments.
Energy and Mineral Resources Minister Bahlil Lahadalia made the remarks during a press conference on Oct 26, following Singapore’s calls for all parties to fulfil their contractual obligations after Indonesia began reducing gas exports to the Republic.
According to The Straits Times, Bahlil said Indonesia had reduced its gas supplies to Singapore by approximately 8%, equivalent to 31 million standard cubic feet per day. Deliveries reportedly fell from 409.55 million standard cubic feet per day.
“Do not lecture Indonesia about its commitment to honouring and respecting contracts,” he said.
Indonesia Says Gas Cuts Remain Within Contractual Limits
Bahlil maintained that the reduction was permitted under existing agreements, citing maintenance-related shutdowns and growing domestic demand as reasons behind the supply constraints.
When asked whether the reductions would become permanent, he indicated that the situation remained uncertain.
“I think the situation remains fluid,” he said, according to The Straits Times.
The minister also dismissed suggestions that the developments had created a dispute between the two countries, insisting that there was no conflict.
However, his comments came amid heightened attention on Singapore’s energy security, as the Republic relies on imported natural gas to generate a significant portion of its electricity.
Force Majeure Could Become A Factor
Bahlil also raised the possibility of force majeure, a contractual provision that may excuse a party from certain obligations when extraordinary circumstances prevent it from fulfilling them, depending on the terms of the agreement and applicable law.
“We respect contracts. But force majeure circumstances can arise, can’t they? Well, we’ll see,” he said.
His remarks leave open the question of whether Indonesia could seek to invoke such provisions if supply constraints continue. Whether force majeure applies would depend on the relevant contractual terms and circumstances.
On Oct 22, Bahlil had also warned that Indonesia would consider reviewing existing export agreements with countries that did not respect its interests. He said Jakarta would not hesitate to consider stopping exports to countries it believed were failing to respect Indonesia.
Singapore is currently the only country reported to have been affected by the latest gas supply reductions.
Lawrence Wong Says Singapore Expects Commitments To Be Honoured
Singapore Prime Minister Lawrence Wong had earlier stressed that the Republic expected all parties to honour their commitments following the start of the export cuts on Oct 24.
He added that Singapore’s gas importer would take the necessary steps to protect its rights and interests under the relevant contracts.
The exchange highlights the importance of stable energy supplies to Singapore, which has limited domestic energy resources and depends heavily on imports to meet its electricity needs.
Singapore Says Electricity Prices Unlikely To Be Affected Immediately
Singapore’s Energy Market Authority (EMA) said on Oct 24 that the reduction represented less than 2% of the country’s daily gas demand.
The authority added that Singapore’s gas importer was prepared to seek alternative supplies, while power generation companies maintained sufficient reserves to manage the situation.
Minister for Energy and Science and Technology Tan See Leng also indicated on Oct 25 that the cuts were unlikely to have a significant immediate impact on electricity prices.
On Oct 26, he reiterated Singapore’s intention to diversify its energy mix and explore alternative sources of supply.
For households and businesses, the immediate concern is whether the reduced gas deliveries could eventually affect electricity costs. While Singapore’s authorities have sought to reassure consumers about the short-term outlook, the longer-term impact will depend on how the supply situation develops.
With Indonesia maintaining that its actions fall within contractual limits and Singapore emphasising the importance of honouring agreements, both sides will be watching closely to see whether gas deliveries return to previous levels or further adjustments become necessary.