Indonesia’s membership on OPEC is due to be reactivated meaning it will regain its status as the only Asian member of OPEC and the only member that is a net importer of petroleum and other liquids.
OPEC currently has 12 members but its membership has always been fluid. Indonesia originally joined in 1962 but suspended its membership at the beginning of 2009.
Its decision to suspend its OPEC membership was prompted by growing internal demand for energy, declining crude oil and condensate production in mature fields and limited investment to increase production capacity. Indonesia has to become a net importer of petroleum and other liquids by 2004 after domestic demand exceeded production, as Indonesia’s production of petroleum and other liquids has been on a general decline since the mid-1990s.
In 2014, Indonesia produced about 790,000 barrels per day of crude oil and condensates, the third lowest level among OPEC countries.
Indonesia said that rejoining OPEC will strengthen its co-operation with oil-producing countries, provide greater access to crude oil supplies, and allow the country to be a link between energy producers and consumers.
Indonesia currently buys crude oil and petroleum products through third parties or traders and wants direct access to long-term crude oil supply contracts through negotiations made between the national oil companies of OPEC members.
It is anticipated that more crude imports will be needed to meet domestic demand from refining capacity additions. Additionally, a number of upgrades and expansions are planned to existing refineries, which are slated to become operational within the next decade.