Indonesia

August 2008 | Risk Summary

Having recently revised up its average oil forecast for its 2008 budget for a second time - from US$90/bbl to US$95/bbl - the Indonesian government is now considering raising its oil price assumption for next year's budget to US$140/bbl, as energy prices continue to soar. Although the price of crude oil has softened somewhat since reaching a record US$147.50/bbl on July 11, it still remains at astronomical levels on an historic basis, and we caution that global oil prices will remain elevated throughout the remainder of 2008 and into 2009. We are forecasting Brent crude to average US$125/bbl in 2008 and US$110/bbl for 2009.

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