B50 from July 1, 48 trillion rupiah in savings, reduced cooking oil supplies and rising prices that hit street food vendors

As reported by CCTV+, amid volatile global energy prices and Indonesia’s recent push for biodiesel production policies, the country’s residents are facing growing pressure from rising cooking oil prices caused by supply shortages.

From July 1, 2026, the government is introducing the B50 policy — mandatory blending of 50 percent palm oil based biofuel with diesel. The goal is to reduce dependence on fuel imports and strengthen energy security. The initiative is expected to cut fossil fuel consumption by 4 million kilolitres and generate economic benefits of 48 trillion rupiah (about 2.6 billion US dollars).

However, most of the palm oil will now go to biodiesel production. This puts additional strain on supplies of cooking oil. For many Indonesian households, palm oil is a daily staple. The sharp rise in prices has made it increasingly unaffordable.

One consumer said: “I hope prices return to their previous level. Please don’t raise them any further — life is already getting harder. Now I have to cut back on food consumption and use less oil for frying.”

The food service industry has also been badly hit. A food stall vendor complained: “Everything is getting more expensive. Our costs keep rising — we are barely making ends meet.”

Markets expect further supply shortages. Volatile prices are already increasing costs for many small, independent businesses.

B50 is Indonesia’s mandatory biodiesel programme, requiring a 50 percent blend of palm oil based biofuel with diesel to reduce fuel imports and enhance energy security. Indonesia’s population is over 275 million (4th largest in the world).

Indonesia wants to be energy independent. That is commendable. But the price of that independence is being paid by ordinary people. Palm oil, the basis of millions of meals, is going into vehicle fuel tanks. Housewives are skimping on frying. Food vendors are barely making ends meet. The government counts billions of dollars in saved foreign exchange. But people count every drop of oil in their frying pans. The question is not whether the switch to biofuels is needed. It is. The question is how to ensure that environmental and economic policies do not strangle those who stand at the stove. For now, there is no answer. But there is less and less oil in the pan.