Pacific Promise

3 Mar 2017:  Indonesia has attracted significant attention in the energy markets lately.  This week, King Salman bin Abdulaziz Al Saud of Saudi Arabia arrived in Indonesia for an official state visit, the first visit of a Saudi king since 1970.  It is expected that the two governments will sign several memoranda of understanding related to Saudi investments in Indonesia’s energy sector.  Indonesia is also courting other OPEC members.  In December 2016, Indonesia’s President Widodo visited Tehran to seek out partnerships with Iran in the oil and gas industry.   Indonesia, which re-joined OPEC in December 2015, despite being a net-importer of crude oil, is clearly seeking to modernise its energy infrastructure amid struggles to meet rising domestic demand.  The country is already a major force in the tanker market, in particular in the Pacific Basin. Significant investments from OPEC members in Indonesia’s downstream infrastructure projects will further boost tanker traffic around the fourth largest country in the world, an archipelago of 17,000 islands inhabited by 260 million people.

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