Shell Gas Stations in Indonesia Run Dry Again Amid Supply Crisis

UPDATE: Shell Plc’s retail gas stations in Indonesia have run out of gasoline for the second time in less than two months, intensifying the fuel supply crisis across the country. As of late last week, three types of gasoline are unavailable at Shell stations nationwide, raising urgent concerns for drivers and businesses alike.

According to a spokesperson from Shell, the company is actively working with government officials and stakeholders to replenish supplies “as soon as possible.” The situation remains critical, with shortages affecting both Shell and BP Plc pump stations since late August, directly linked to Indonesia’s stringent import restrictions on gasoline.

WHY THIS MATTERS NOW: Indonesia, Southeast Asia’s largest economy, is grappling with fuel shortages that threaten local demand as government-imposed guidelines limit imports by private retailers. The import restrictions have not only affected Shell but have also impacted other companies like BP and Vivo Energy, leaving consumers frustrated and fueling economic uncertainty.

In a statement, Shell confirmed that approximately 200 gas stations across Indonesia are currently affected by the supply disruptions. The government’s energy and resources ministry has indicated that state-owned PT Pertamina can import fuel on behalf of private retailers that exhaust their quotas. However, complications have arisen, with at least one retailer canceling orders due to quality concerns, compounding the crisis.

The implications of this fuel shortfall are significant. Fuel traders in Singapore have reported that the situation has led Pertamina to issue multiple buy tenders in recent months, reflecting a growing urgency to meet local demand. Additionally, unplanned refinery outages globally have exacerbated the issue, pushing the profitability of crude-to-gasoline conversions above the five-year average.

This crisis comes amid increased scrutiny of Indonesia’s oil supply security, particularly as President Prabowo Subianto advances a multi-billion dollar corruption investigation into Pertamina. The urgency of the situation has led Jakarta to call on fuel traders in Singapore for cooperation in the probe, with threats to cut supplies from the Asian oil hub looming over the industry.

Earlier this year, Shell announced plans to sell its Indonesian gas stations and fuel distribution operations to a joint venture led by Citadel Pacific Ltd. and Sefas Group, indicating a significant shift in the company’s operations within the region.

As the crisis develops, consumers are left anxiously waiting for updates on when fuel supplies will stabilize. Shell’s coordination efforts with the government may be crucial in resolving this urgent dilemma, but for now, drivers across Indonesia face uncertain and challenging circumstances.

Stay tuned for further updates on this developing story.